Thanks to fracking, U.S. oil deficit is at a 17-year low
While the U.S. is a net exporter of petroleum products, it is still a net importer of crude oil, resulting in a petroleum trade deficit, the gap between the value of petroleum imports and exports. That gap fell to its lowest value in April, the lowest trade deficit since 1999, at seasonally adjusted $3.13 billion in April, according to the Census Bureau and reported by Bloomberg.
Three factors are responsible for the declining petroleum trade deficit. First, the shale energy revolution resulting from fracking combined with horizontal drilling doubled U.S. production of crude oil, catapulting it to being one of the top three crude oil producers in the world. Second, Congress approved a bill sponsored by Texas Congressman Joe Barton that lifted the 40-year old ban on crude exports, pushing up exports of crude oil and petroleum to $7.19 billion in April. Third, cheap American crude oil and natural gas helped U.S. refiners ramp up exports of gasoline and other refined products, cutting into the petroleum deficit and turning the U.S into the world’s biggest exporter of crude oil and petroleum products.
Thanks to the shrinking petroleum trade deficit as a result of fracking, the U.S. trade deficit declined to $531.5 billion in 2015 from the record $762 billion trade deficit in 2006. A lower deficit means overall exports are gaining on imports. That's good for the energy industry and all U.S. businesses that will create more U.S. jobs.