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As pain at the pump continues, the U.S. is exporting as much oil as it’s importing

As gas prices go up, Texas continues to ship the oil and gas we produce overseas. There is a reason we can’t keep it.

CORPUS CHRISTI, Texas — Steve Wilder and Patrick Nye always know who’s coming and going through the La Quinta channel, which is practically the backyard of their Corpus Christi home. The ships are kind of too large to miss.

“I think it’s Greek,” the two men say, discussing a giant docked ship. “By the flag, it looks like Greece’s flag. He’ll be gone tomorrow.”

The men’s backyard also happens to be near the port of Corpus Christi, a hub for oil and natural gas exporters. 

Texas is the largest producer of crude oil at 4.8 million barrels per day in 2021, roughly 30% of U.S. production. It also has 47 of the 129 refineries in the country.

“I have a fundamental problem with exporting, I really do,” said Nye.

Ingleside by the Bay has been home for 55 years. He’s seen the ships come, load up and leave. 

He’s also wondered why. 

“We're exporting oil from our own country,” Nye said. “And we're importing oil about the same amount from countries that we can't control. Why are we doing that? Why can't we use it?”

“Part of that oil is coming out of Houston, is actually going to ports on the East Coast,” said Edward Anderson, Mr. and Mrs. William F. Wright Centennial Professor for Management of Innovative Technology at McCombs School of Business, University of Texas at Austin.

He studies supplies chains very closely, including how goods and materials are produced and travel. 

“I’m interested in all types of supply chains,” he said. “I spent about an hour and a half watching those every day.”

Anderson told KENS 5 that the U.S., on average, exports 15 million barrels per day and imports 15 million barrels per day.

KENS 5 asked a simple question, the same one you might be thinking: How does that make any sense? Why can’t we keep what we’re producing since we’re bringing in as much as we’re shipping out?

The answer, Anderson said, is in the cost of getting oil to its destination.

“That's one of the things that goes on with the science of logistics,” he said, “is that it's not always the most obvious way that you would expect in order to minimize transport costs.”

“It is more expensive for us, for example, to ship oil to Alaska, than it is to bring oil in from overseas,” Anderson explained.

Or cheaper to import oil to California then to transport it from Houston, for example.

“It's very complicated, all the different routes,” Anderson said. “If we block exports of, say, oil, other countries might stop shipping things to us. There are some things we don't make here.”

What does that mean for us at the pump? The prices will drop, Anderson said. But when and by how much depends on many factors, including the war Russia is waging in Ukraine. 

 

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