We have heard a lot lately about the trade deficit. The crazy thing is, as much as the oil and gas industry has changed in recent years, the overall trade deficit has stayed the same.
As Bloomberg Energy reporter Javier Bias pointed out on February 24, the trade deficit today is right around $800 billion, almost exactly as high as it was at its previous peak around 2006 to 2008. In 2008, nearly half the trade deficit came from petroleum imports. Today, the petroleum trade deficit has almost completely disappeared. The overall trade deficit has stayed about the same, though.
The New York Times reported on this phenomenon late last year. Part of the issue is the rise in the dollar’s value, which discourages foreign customers from buying American products. This harms companies like Whirlpool, Carnival Cruise Lines, and Coca-Cola. The Trump administration is leaning into investments in oil and gas infrastructure, though. Investment growth in resource extraction has been about 30% in the past two years, while it was around 10% under Pres. Obama and 8% under Pres. George W. Bush.
The change in natural gas imports is an important part of this story as well, but it remains a rounding error compared to crude oil. The cost of moving natural gas over long distances has historically meant there is limited international trade. Some experts are not content with that situation, though. Many argue that aggressive efforts to invest in liquefied natural gas export facilities could improve the trade deficit more.
As you read this article, natural gas from Appalachia is either being exported from America or offsetting gas from other areas that is being exported. If your company wants to be a part of this production you can call (412) 212-7517 to speak with the local land experts at Cimmaron Land.