US Oil Import Bill to Top $400 billion this Year, Says Petroleum Intelligence Weekly

Business Wire, March 7, 2008

NEW YORK -- With the run-up in oil prices over the past four years, the United States is paying dearly for its dependence on imported oil, Petroleum Intelligence Weekly (PIW) reports in its latest issue. The US oil import bill last year came to some $327 billion, and should easily top $400 billion this year. That's an increase of some 300% since 2002, according to PIW.

Last year, PIW reckons that the US paid out a record $245 billion for about 10 million barrels per day of crude oil imports, and another $82 billion for about 3.5 million b/d of imported oil products. This year it looks like paying out even more, with domestic crude production continuing to fall, demand for imports of high-priced transport fuels remaining strong, and oil prices around 30% higher year-on-year so far in 2008. The increase to an estimated $440 billion for 2008 is based on an average $90 per barrel crude oil price for the year. In 2002, before the current bull market for oil began, US oil imports cost less than $103 billion.

US Oil Import Bill  >          >          >            >




($-bill)            >          >   Total  >            >
Crude

Products

2000                >          >  119.26  >            >
89.88

29.38

2001                >          >  102.74  >            >
74.29

28.45

2002                >          >  102.77  >            >
79.25

23.52

2003                >          >  132.44  >            >
101.80

30.64

2004                >          >  179.27  >            >
136.03

43.24

2005                >          >  206.06  >            >
138.94

67.12

2006                >          >  300.07  >            >
225.53

74.54

2007p               >          >  327.34  >            >
245.53

81.81

2008e               >          >  440.00  >            >
331.00

109.00

p-preliminary, e-estimated.

With oil prices this year as strong or stronger than in 2007, any moderation in the US import bill must come from reduced volumes. While oil demand growth has slowed in recent years due to both high prices and greater fuel efficiency, the higher quality of crude oil imports that US refiners require and the emphasis on high-quality transport fuels in the product import mix are likely to keep upward pressure on import costs even if volumes are stable, according to PIW.

Although "energy security" and "dependency on the Mideast" get the attention in the national debate over oil imports, huge and rapidly rising costs are of greater immediate economic significance, PIW says. Relatively secure supplies from Canada and Mexico account for about one third of crude imports.

Petroleum Intelligence Weekly is published by Energy Intelligence, www.energyintel.com.