American Oil Supply

[Tmy]

Ive heard that a lot of US oil is exported to Asia. Is this true? If we were to open up ANWR for drilling what assurance do we have that the oil would stay in the domestic supply?

[Jocko]

Originally posted by Tmy
Ive heard that a lot of US oil is exported to Asia. Is this true? If we were to open up ANWR for drilling what assurance do we have that the oil would stay in the domestic supply?

I don't see how that matters. The oil is drilled and refined by private companies (paying fees to the government for use of the land). No one can tell them who to sell to.

Besides, oil to Asia equals dollars (or seashells or rocks or whatever they use for money) to America. It seems like on the grand scale, money and oil are pretty much interchangable.

If ANWR appreciably increases available oil supply, that will also drive global prices down a bit. So even if every drop goes overseas there's still some benefit.

F-caribou.

[hammegk]

Thanks to dictionary.com

fun·gi·ble adj.
1.Law. Returnable or negotiable in kind or by substitution, as a quantity of grain for an equal amount of the same kind of grain.
2.Interchangeable.

At the refined product level, gasoline at 90 octane is gasoline at 90 octane, etc.

At the crude level, different refineries are willing to pay somewhat more or less depending on probable refined product yield -- depends on analysis of the specific crude -- and transportation cost; the world markets also ensure crude is fungible too.

[aerocontrols]

Originally posted by Tmy
Ive heard that a lot of US oil is exported to Asia. Is this true? If we were to open up ANWR for drilling what assurance do we have that the oil would stay in the domestic supply?

I believe the point is to have a domestic supply in the event that foreign suppliers boycott.

If OPEC starts up another embargo and we have shortages, I think we can feel fairly sure that US oil supplies will stay in the US. Congress might even pass legislation ensuring it.

That said, if the world market remains open, the oil should go where it can make the most money. It's nonsensical to expend money shiping oil from ANWR to Georgia if shipping costs from Venezuela to Georgia and from ANWR to Japan make more sense.

MattJ