January, 2011, Oil Imports Jump: Raises Questions

I was sent a copy of T. Boone Pickens' most recent memo regarding recent events in Egypt.

(Note: this is not a private memo. Mr Pickens sends out these memos on a regular basis and easily accessible to all.)

• Mr Pickens continues to advocate for his natural gas plan, using natural gas as a "bridge" to America's energy future.
• In his memo, he noted that the United States imported 366 million barrels of oil in January (2011) at an average price of $89.17/barrel. The amount imported represented 62 percent of America's requirements. Sixty-two percent.
• According to Mr Pickens, importing oil cost America $32.6 billion which was the most spent in any month since September, 2008, when the economic downturn began.
• Mr Pickens opines that "we'll" see gasoline prices hit $4.00/gallon this summer.

I was vaguely aware that January was a big month for oil imports but did not know that it was the most spent in any one month in the last two years.

*******

(For the rest of the discussion, I am just looking at volume; Mr Pickens was looking at dollars spent.) 

Going back to EIA data, these are the import numbers. In the summer of 2008, the US hit a recent high for imports. The imports dropped to a recent low during the economic depression:

• August, 2008: 10.128 million barrels/day imported
• December, 2008: 9.790 million barrels/day imported
• August, 2010 (one year ago): 8.816 million barrels/day imported
• December, 2010 (two months ago): 8.552 million barrels/day imported
• January, 2011 (most recent month): 8.879

Those are EIA numbers.

The Pickens' number (11.806) is such a huge jump it's possible that Pickens is including something the EIA does not include. But Mr Pickens said 366 million barrels in the month of January which is 11.806 million barrels/day (366/31 = 11.806 million barrels).  EIA data.

Regardless, the increase can only mean: a) the US economy is truly gaining speed and we consumed more oil; b) US production declined; or, c) a little of both.

My hunch is that it was a bit of both. Remember: the Gulf "permitorium" continues.

What doesn't make sense is why we imported so much foreign oil when the tanks at Cushing are maxed out.