Although that is true, the US imports less and less oil from Saudi. In fact, it’s been dropping steeply since shale oil became cheaper in 2014 and we haven’t imported less from Saudi since the oil glut of the mid-1980s.[1] I don’t think the US stopping Saudi oil imports is going to worry them as China is their major market now and China is another repressive regime. We should stop protecting their shipping though as we do for the entire globe still.
Not really; the issue with Saudi oil has mostly not been direct imports US has (both as a net importer and net exporter) for some time gotten more of it's gross imports from other, nearer sources.
The issue for the US with Saudi oil has been global oil prices and the knock-on effects on, well, everything else.
> The United States has a net export of around 0 barrels, meaning that it is neither an importer nor an exporter of oil today. So macroeconomically the US should be more or less unaffected on an aggregated level.
Not true. Shale oil is very expensive to extract while Saudi oil is amongst the cheapest. Low prices are going to put shale producers out of business and the Saudis will gain market share.
> Last time the US was a net oil exporter was in the 70s
Pardon me, edited. Point being that the net oil imports the U.S. economy requires are too small to be entirely dependent on Saudi oil. As long as the KSA is selling oil, the critical factor to the American economy--oil prices--will remain roughly stable.
Last year, yes, for the first time since 1949. But even in 2020, we were importing more crude oil than we were exporting. The difference was due to the refined products that we exported.
It’s destroying demand at a massive clip, if the IEA is to be believed [1]. With Riyadh’s elevated break-even price [2] that doesn’t leave them a lot of time.
> because we are running out of oil, the precious and finite resource that is utterly destroying our planet.
Not really running out. The US is the largest oil producing nation in the world now, and our output is at the highest levels[1] in history. Oil is practically dirt cheap and I don't see it breaking out in price anytime soon.
Production for the month of March is published and does not show a significant increase. Again, its likely that the sources you follow are providing misinformation - not just about this, but about other things as well.
More generally, I follow oil news quite closely (as I work in the sector, and I have worked in Saudi Arabia specifically). These types of claims are "widely report in the media" constantly every year, although it is interesting that there's a Wikipedia page about this year's events. I personally wouldn't trust that version of events, as it only narrates changes in price without addressing movements of the supply/demand curve. I consider volumes of supply and demand to be more narrative for fungible commodities than statements of price alone.
As all these price movements happened after China's enormous quarantine and reduction in road traffic in February, I'd posit that the falling prices are a result of concrete reduced demand, rather than hand-wavey price adjustments.
Saudi can't adjust price lower globally single-handedly, the next marginal sales will happen at the market price. This wikipedia article doesn't seem to see that. The only way Saudi can reduce the price for its competitors is by supplying more oil to the global market.
>comes from environmentally destructive practices, which is a damn good reason to prefer imports.
I'm sure Russia, Venezuela, Iran, Saudi, etc. really care about the environment and their reports about environment sustainability* are totally true.
The average oil producer is a dictatorship, and I suspect the impact of lack of transparency is more important than the drilling method - they have every motivation to cut corners, while American oil is openly regulated. So from the global perspective I doubt American production is more polluting.
>>America now produces enough oil that cutting off Saudi Arabia wouldn't be any kind of energy crisis.
This is naive. When you cut off Saudi Arabia, you cut off all OPEC. And that would devastate America, even at the current levels of domestic production.
> Did your desire to use the word fungible outweigh the fact that the US has drastically reduced its dependence already?
No, facts are facts. Your own citation shows the US is still importing 3 million/barrels a day from OPEC (~33% of US daily consumption), and has held somewhat constant at that level since 2013. The price of oil would rise if those 3 million/barrels a day weren't on the world market, or if the US was required to source those barrels elsewhere.
Not a lot of electrical generation sources in the US run by authoritarian governments compared to oil producers. If it's not Saudi Arabia, it'll be another government attempting to control energy supplies. Can't control a country's electrical generation so easily, and therefore it makes the most sense to incentivize the rapid electrification of transportation.
2. The fact that the US only gets 3% of its oil from Russia is kind of irrelevant - it's largely a global market.
3. The idea that Russia can just switch to selling all of its oil to China, so then the West can then get its oil from someplace else (a) is not feasible and (b) would completely defeat the purpose of sanctions in any case.
4. Prices are always set at the margins. A relatively small shortfall can cause a huge price increase primarily because, when there is a shortfall, the price needs to increase enough for some buyers to just drop out of the market altogether.
> the US runs on diesel. We don't produce much heavy oil so we import it
Diesel is a medium-weight distillate; we can turn light oil into it fine. We refine most of our diesel and import the balance from Canada [2].
> Fracking, anyway, is an economic mirage enabled by cheap credit and expensive oil
Our production costs mirror Russia’s [3][4]. (They’re dwarfed by Saudi Arabia’s fiscal break even.)
Consider citing your comments. I’ve sometimes started writing something as riddled with errors as yours, only to find myself corrected when searching for citations.
Although that is true, the US imports less and less oil from Saudi. In fact, it’s been dropping steeply since shale oil became cheaper in 2014 and we haven’t imported less from Saudi since the oil glut of the mid-1980s.[1] I don’t think the US stopping Saudi oil imports is going to worry them as China is their major market now and China is another repressive regime. We should stop protecting their shipping though as we do for the entire globe still.
1: https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M...
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