Mid-year trade report from the U.S. Commerce Department shows the oil and natural gas industry continues to drive U.S. economic gains in 2015, American Petroleum Institute’s (API) said in a statement Wednesday.
API’s Chief Economist, John Felmy has said that such trend could accelerate under free trade policies.
“Despite a very competitive global market, the U.S. energy revolution continues to push our trade balance in a positive direction,” said Felmy. “Oil imports remain on the decline, and strong exports of petroleum and refined products are creating new opportunities for America to bring wealth and jobs back to U.S. shores.”
API has noted that the total U.S. trade deficit peaked at $762 billion in 2006, prior to the surge in U.S. oil and natural gas production, and by 2014, it had dropped to $508 billion. According to API, the U.S. Commerce Department’s latest report, covering trade data through June 2015, shows that the U.S. trade deficit among petroleum and petroleum products fell by 56.1 percent compared to the first six months of 2014 (exhibit 9).
That growth helped to hold the total U.S. year-over-year trade balance steady, despite a 23.1 percent increase in the trade deficit among non-petroleum products, API says. Due to low commodity prices, the value of U.S. petroleum and petroleum product exports fell by $20.2 billion, despite high export volumes, but petroleum-related imports fell faster, down $78.6 billion compared to the first six months of 2014.
“Outdated trade policies are among the biggest threats to America’s continued growth right now,” added Felmy. “Accelerating approval of LNG export terminals and lifting the 1970s era ban on crude oil exports would put America in the driver’s seat on trade. America is now the world’s largest producer of natural gas, providing our workers an important competitive advantage in the global market. And study after study shows that lifting the ban on crude exports will mean more jobs, downward pressure on fuel costs, and could reduce the power that foreign suppliers have over our allies overseas.”
“Strong, bipartisan legislation to accelerate America’s growth as an energy superpower is now making its way through both chambers of Congress. We urge members of the House and Senate to make free trade in energy a top priority when they return from their August recess.”