Oil imports continue despite production growth

While U.S. oil production and export capacity both are expanding rapidly, don't expect imports to end anytime soon.

The country's production surged to 11.7 million barrels of oil per day in the last week of November, according to the U.S. Energy Information Administration. That's up about 2 million barrels per day from one year ago and up 113 percent from 5.5 million barrels a day in 2011.

Crude oil exports have expanded rapidly since President Barack Obama lifted the country's 40-year-old ban in 2015. U.S. producers are exporting about 3.2 million barrels of oil per day, and expansion projects underway promise to rapidly boost the country's export capacity over the next few years.

Including refined products like gasoline and diesel — which were not included under the crude oil export ban — the United States became a net petroleum exporter last month for the first time in 75 years, according to the government data.

Still, the country continues to import large amounts of crude oil and likely will for many years to come. While the country exported 3.2 million barrels per day of crude oil last month, U.S. refiners imported 7.2 million barrels per day.

The main reason for the continued use of foreign oil is because of the configuration of U.S. refineries.

Crude oil is far from uniform. Most U.S. shale oil is considered light, sweet oil, meaning it is relatively thin and has little sulfur content. Much of the oil imported from Canada, Venezuela and parts of the Middle East is heavy, sour oil, which is thicker and has more sulfur.

Since U.S. refineries had increasingly relied on foreign oil for much of the past 50 years, operators spent billions of dollars equipping them to handle the foreign oil. They can use some domestic oil, but they are most productive when they include a blend with heavy, sour oil.

Also, about 25 percent of U.S. refinery capacity is owned by foreign oil companies.

Those refineries tend to import oil from the country that owns them.

While U.S. refineries are designed to handle foreign oil, many of the refineries in Europe and Asia are designed to handle the light, sweet oil the United States is now exporting.

If U.S. oil production continues to grow at current rates, refinery operators might choose to expand or upgrade their equipment to handle more domestic crude.

But that part of the industry tends to move slowly.