It has been an interesting couple of weeks for U.S. energy exports. On December 6, Bloomberg reported that the U.S. became a net oil exporter for the first time in 75 years. For one week at least, America’s net imports of crude oil and refined petroleum products fell below exports. Bloomberg called this brief moment of energy independence a bit of a paper tiger achievement, though, because U.S. prices remain heavily influenced by world events.
Natural gas, on the other hand, is less impacted by world events because it cannot be shipped around as easily. That is changing with an expansion of liquefied natural gas infrastructure around the world, though. One country with a big appetite for natural gas is China, so trade between China and the U.S. has an outsized impact on natural gas development. In fact, China is the fastest growing importer of LNG in the world, and the U.S. is the fastest-growing exporter. Many American export projects are depending on sales to China for their economic justification.
On December 3, Reuters reported that China and the U.S. had come to a bit of a truce on their trade war after meeting at the G20 in Buenos Aires, Argentina. Many experts took this as a positive sign that the growing natural gas trade would not be slowed by trade disagreements. The countries’ 90-day peace accord is not going to be enough to commit to a multi-billion dollar export project, according to most experts, but it is a step in the right direction. The peace seems to be holding so far. Bloomberg subsequently reported that China has resumed buying soybeans plans to resume buying American corn in January.
Expanding infrastructure in the Marcellus region is allowing more of our gas to get to world markets. At Cimmaron Land, we help companies secure the right to explore and produce this gas for the world. For more information, just call 412-212-7517.