Why did the United States, which produces more crude oil than it consumes, import crude oil from Russia?
The United States has announced a ban on imports of Russian crude oil as a sanction for Russia, which continues to invade Ukraine. Nasdaq explains the question about this decision: 'Why is the United States importing crude oil from abroad when it produces more crude oil than it consumes in the first place?'
America Produces Enough Oil to Meet Its Needs, So Why Do We Import Crude? | Nasdaq
https://www.nasdaq.com/articles/america-produces-enough-oil-to-meet-its-needs-so-why-do-we-import-crude
Only a very small amount of crude oil is produced in Japan, and most of the crude oil consumed depends on imports. In contrast, the United States produces 18.4 million barrels of crude oil per day for a daily consumption of 18.12 million barrels , which exceeds consumption. At first glance, it seems that the United States does not need to import crude oil, but in reality, the United States imports 7.86 million barrels of crude oil per day from other countries.
One of the reasons the United States imports crude oil is the difference in oil extraction costs from country to country. When frying crude oil, many processes such as 'separation of crude oil and gas' and 'dehydration / desalting of crude oil' are required, and the cost required for this varies from country to country. According to Nasdaq, it is often cheaper to fry crude oil in another country and transport it to the United States than to fry it in the United States. For this reason, the United States imports a lot of crude oil.
In addition, the API gravity and sulfur content of crude oil differ depending on where it is produced. In the United States, many ' sweet oils ' with low API gravity and low sulfur content are produced. The refining process of crude oil changes depending on the composition of crude oil, but as mentioned above, crude oil imported from other countries is cheaper, so refineries in the United States are optimized for crude oil processing in other countries.
Due to the high cost of building a crude oil treatment facility from scratch, the United States has been using it for decades with maintenance and is not optimized for sweet oil processing. For this reason, the United States continues to have to continue importing crude oil from other countries.
In addition, Nasdaq points out that the US energy policy did not work to reduce its dependence on oil, which also contributed to the current situation of dependence on oil abroad. For these reasons, the impact of the ban on crude oil imports from Russia is unavoidable even in the United States, which produces a large amount of oil.
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