US petroleum exports to the European Union have grown 22 percent this year
Import bans on Russian energy resources have led members of the European Union to look to the US to fill the gap...
In response to Russia’s escalation of the war in Ukraine, members of the European Union imposed import bans on Russian energy commodities, a blow to one of the country’s primary economic sectors. This move contributed significantly to inflation in EU member states as energy bills and gas prices began to soar. Early in 2022, German households saw energy bills rise by twelve percent, and in Spain, that figure was as high as thirty-three percent. Later in the year, households in Romania, Czechia, and Denmark were seeing the greatest rise in their bills.
As EU members looked to fill the gap left by the ban on Russian energy resources, oil and gas producers in the United States, knowing that they would profit greatly, began to increase production for export. From 2021 to 2022, petroleum exports from the US to the EU grew by a staggering forty-one percent, from 426 million barrels to 598 million barrels, according to data published by the US Energy Information Agency (EIA).
Which countries import the greatest quantity of US petroleum?
This year, from January to April, US petroleum exports to its allies across the pond have grown twenty-two percent when comparing those exported to EU members over the same period in 2022.
During the first four months of 2022, the EU members that imported the greatest amount of petroleum from the US were: the Netherlands (57.5 million barrels), France (26.3 million barrels), Spain (24.1 million barrels), Italy (20 million barrels), and Belgium (12.3 million barrels).
This year, the Netherlands (84 million barrels) remains in the top spot, with Spain (24.4 million barrels) surpassing France (23.6 million barrels), followed by Italy (19.5 million), Sweden (15.8 million), and Belgium (13.8 million barrels).
However, when looking at the growth in US imports EU members over the same period, Bulgaria (+257 percent), Finland (+227 percent), and Poland (+91 percent) have seen the most largest change. Meanwhile, seven countries, Italy, France, Greece, Slovenia, Portugal, Hungary, and Latvia have decreased their dependence on US petroleum so far this year.
Oil prices set to increase in 2023 and 2024
The EIA recently reported that prices could begin to rise later this year and next after OPEC members agreed to another cut in production in June. These cuts, coupled with a projected increase in consumption, led the EIA to project that by the end of next year, the Brent crude oil price could surpass $85 per barrel, a $10 increase from its position in June.
With US producers being unlikely to fill the gap in production necessary to keep prices down, the EIA forecasts the West Texas Intermediate crude oil price to rise above $80 per barrel.