Oil Industry in the United States
- Dariana Reyes
- Mar 20, 2022
- 2 min read
America’s Oil Consumption
The United States is the world’s largest oil consumer, in 2021, on average 20 million barrels of petroleum is consumed per day. Motor vehicles consume 40 percent of that, or 7.9 million barrels. Some might say that America has a problem with oil consumption, especially since one of the world's largest countries, China, only consumes around eleven million barrels a day. America's consumption problem is highlighted even further when you consider that the U.S. represents only about 5% of the global population but consumes a quarter of the world’s oil.
But, from where does America receive its oil?
Over eleven million barrels of crude oil are imported every day, and half of the oil America consumes is produced domestically. Although consumption in America is on the rise, production has reached a 50-year low. Texas (41.4%), North Dakota (11.6%), and New Mexico (7.4%) are the three top oil-producing states. America’s oil production is so big it generates around 6 million jobs a year. Second to America is Canada, importing more than 2 million barrels a day, followed by Mexico, Saudi Arabia, Nigeria, and Venezuela, each exporting more than one million barrels a day.
US Oil Industry facing obstacles
In the wake of the Russian-Ukraine conflict, President Joe Biden issued a ban on Russian oil imports, followed by demands that U.S. oil production be boosted at an all-time high primarily in an effort to address soaring gasoline prices. However, the plans to increase American oil production do not tally with the oil industry's current state: not enough workers to rapidly expand, inadequate funding to invest in drilling, and wariness that today’s prices won’t last. Prior to the conflict between Russia and Ukraine, the oil industry faced another obstacle, namely the Coronavirus. During the first few months of the pandemic, dozens of oil companies went bankrupt, forcing others to retrench and halt drilling.
Biden Administration tries to find solutions
In response to the rising gas prices, the Biden Administration has reached out to Saudi Arabia and Venezuela for help in filling any oil shortages. To help maintain price stability, the White House also announced the release of 30 million barrels of oil from the nation's Strategic Petroleum Reserve. More solutions are still being discussed.
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