Category: US Energy Information Administration

Source: US Energy Information Administration

September 12, 2023

Data source: International Group of Liquefied Natural Gas Importers (2018–2021) and CEDIGAZ (2022–1H23)
Note:1H23=first half of 2023. Includes annual liquefied natural gas exports by country for 2018–2022 and 1H23 average exports for 2023.

---

The United States exported more liquefied natural gas (LNG) than any other country in the first half of 2023 (1H23), according to data from CEDIGAZ. U.S. LNG exports averaged 11.6 billion cubic feet per day (Bcf/d) during this period, 4% (0.5 Bcf/d) more than in 1H22, according to data from the U.S. Department of Energy’s LNG Reports. Australia exported the world’s second-largest volume of LNG in 1H23, averaging 10.6 Bcf/d, followed by Qatar at 10.4 Bcf/d. The increase in U.S. LNG exports mainly resulted from Freeport LNG’s return to service as global LNG demand remained strong with continuing growth, particularly in Europe.

Data source: U.S. Department of Energy, LNG Reports
Note: Data are annual averages for 2021 and 2022 and the six-month (Jan–Jun) average for 2023.

---

Like in 2022, EU countries (Europe) and the UK remained the main destination for U.S. LNG exports in 1H23, accounting for 67% (7.7 Bcf/d) of total U.S. exports. Five countries—the Netherlands, the UK, France, Spain, and Germany—imported more than one-half (6.0 Bcf/d) of total U.S. LNG exports.

U.S. LNG exports set a monthly record of 12.4 Bcf/d in April as Freeport LNG ramped up LNG production and as Europe and the UK continued to increase LNG imports to compensate for reduced pipeline imports from Russia and to refill storage inventories. Europe and the UK’s regasification capacity continued to expand in 2023 as new terminals were placed in service in Finland, Germany, Italy, and Spain, allowing those countries to import more LNG. After a mild winter, Europe and the UK ended the 2022–23 heating season with the most natural gas in storage on record, and the region continued importing LNG to rapidly refill its storage inventories in the spring and summer.

In the first six months of this year, Europe and the UK’s LNG imports exceeded imports by pipeline for the first time on record, according to data from Refinitiv Eikon. Europe and the UK’s LNG imports averaged 15.9 Bcf/d, 0.1 Bcf/d more than that region’s imports by pipeline from all sources. In 2022, LNG imports to the region averaged 14.9 Bcf/d annually, 28% (5.8 Bcf/d) less than natural gas imports by pipeline. Europe and the UK’s LNG imports peaked in April 2023 at 18.0 Bcf/d and remained above natural gas imports by pipeline from April through June 2023.

Principal contributor: Victoria Zaretskaya

Source: US Energy Information Administration

September 11, 2023

---

We estimate that the United States added 6.4 gigawatts (GW) of small-scale solar capacity in 2022, the most ever in a single year.

Small-scale solar—also called distributed solar or rooftop solar—refers to solar-power systems with 1 megawatt (MW) of capacity or less. Rooftop solar panels installed on homes make up the majority of small-scale solar capacity in the United States. Small-scale solar power systems are also used in the commercial and industrial sectors.

U.S. small-scale solar capacity grew from 7.3 GW in 2014, when we started publishing these estimates, to 39.5 GW in 2022. Small-scale solar makes up about one-third of the total solar capacity in the United States.

Tax credits and incentives, public policy, and higher retail electricity prices have encouraged the growth of small-scale solar capacity over the past decade. Falling solar panel costs have also played a significant role.

California has, by far, the largest share of the country’s small-scale solar capacity, at 36%. Ample sunshine, favorable incentives, and relatively high retail electricity prices have encouraged rooftop solar adoption in California. California’s Net Energy Metering Program allows rooftop solar panels to be connected to the power grid and provides credits for any surplus electricity produced by the panels and sent to the grid. Starting in 2020, California requires newly built single-family homes and multifamily buildings up to three stories high to have solar panels installed.

New York and New Jersey—mid-Atlantic states with less year-round sunshine—have the second- and third-most small-scale solar capacity, respectively, although in recent years, sunny Texas and Arizona have been closing the gap. Long-standing state policies in New York and New Jersey offer generous solar incentives and have encouraged small-scale solar growth.

Many of the states with the most small-scale solar capacity also have large populations. Accounting for population size provides insight into how prevalent small-scale solar capacity really is in a state. Although California has the most small-scale solar capacity, Hawaii has the highest small-scale solar penetration, at 541 watts per capita.

---

A large share of Hawaii’s electricity has historically come from oil-fired power plants. These plants rely on expensive fuel imports, resulting in high electricity bills. As solar panel costs have fallen, many homes and businesses in Hawaii have added solar panels, reducing their electricity bills and helping the state work toward its target to generate 100% of its electricity from renewable sources by 2045.

Principal contributors: Elesia Fasching, Katherine Antonio

Source: US Energy Information Administration



Production cuts drive sour crude price increases

Production cuts among OPEC+ members are limiting availability of medium and heavy sour grades of crude oil and contributing to higher relative prices for these grades, reversing typical price relationships. In early June, OPEC+ members announced they would extend their production cuts through 2024. Saudi Arabia also announced it would reduce production by an additional 1 million barrels per day (b/d) for July. The voluntary Saudi production cuts were extended several times, and Saudi Arabia announced on September 5 it would extend the additional cuts through the end of 2023. Most of Saudi Arabia’s crude oil contains more than 1% sulfur, our threshold for classifying crude oil as sour, although Arab Extra Light and Arab Super Light are considered sweet. The production cuts are having a larger impact on the price of sour crude oils, although global crude oil inventory draws are also putting upward pressure on light, sweet benchmarks such as Brent and West Texas Intermediate (WTI).

Light, sweet crude oils typically trade at a premium compared with sour crude oils because they are less costly to refine and tend to produce higher yields of more valuable products. Sweet and sour crude oil price spreads have narrowed in most major trading hubs, including those in North America, Europe, and the Middle East. The spread between the price of medium, sour Mars crude oil and the light, sweet Magellan East Houston (MEH) declined since late 2022, and Mars was sold at a small premium briefly in July (Figure 1). The price of MEH reflects the price of light, sweet crude oil at the Enterprise ECHO terminal in Houston, Texas. The spread has increased over the past few weeks, although it is still down from earlier this year.

Between July 7 and August 25, U.S. commercial crude oil stockpiles declined 8% (35.2 million barrels). Most U.S. crude oil production is light, sweet crude oil, and the price of MEH increased more than the price of Mars, widening the spread. After Saudi Arabia’s September 5 announcement to extend its production cuts through the end of 2023, the spread between MEH and Mars narrowed again to $0.61 per barrel (b) as of September 6.

Globally, sour crude oil prices are also increasing compared with other sweet benchmark crude oils. Medium, sour Dubai Fateh (an Asia/Middle East benchmark), which is similar to Saudi Arabia’s Arab Light, recently traded at a price premium to light, sweet Dated Brent, reversing the typical trend. Between June 21 and September 1, Dubai Fateh traded at an average premium of $0.62/b compared with Dated Brent, based on a five-day rolling average (Figure 2). Since September 5 (the day Saudi announced an extension to their production cuts), the price of Brent increased, and on September 6, Brent traded at a $0.44/b premium to Dubai. That compares to Dated Brent trading at an average premium of $2.56 per barrel (b) compared with Dubai Fateh between January 4, 2021, and June 20, 2023. Trade press reports similar strength in Norway’s Johan Sverdrup—a medium, sour crude oil—as refiners bid up the price amid supply constraints.

In our August Short-Term Energy Outlook, we estimate that global petroleum stocks declined by 530,000 b/d in June after building by an average of 810,000 b/d between January and May. The global stock draws in June were the result of monthly consumption growth (led by Europe and other non-OECD countries) that outpaced production growth. Beginning in July, OPEC+ production cuts contributed to global inventory draws, putting upward pressure on crude oil prices. We estimate that OPEC crude oil production declined by 650,000 b/d to 27.6 million b/d in July, the lowest production since October 2021. OPEC production cuts were led by Saudi Arabia, which cut production by 750,000 b/d to 9.3 million b/d in July, the least since June 2021. We forecast global stock draws will average 630,000 b/d in the third quarter of 2023 (3Q23) and 120,000 in 4Q23.

Following Saudi Arabia’s crude oil production cuts, its crude oil exports fell. According to data from Vortexa Analytics, Saudi Arabia exported 6.7 million b/d of crude oil and condensate in June. Exports fell 18% (1.2 million b/d) in August to 5.5 million b/d (Figure 3). Exports from Kuwait also fell over the same period. Kuwait exported 1.4 million b/d of crude and condensate in August, a 17% decrease (270,000 b/d) from exports in June.

Saudi Arabia also increased the official selling price (OSP) of Arab Light (a medium, sour crude oil) to Asia and Europe, further pushing up the price of global sour crude oil. Saudi Arabia’s OSPs to Asia and Europe are based off differentials to regional benchmark crude oils. Saudi Arabia uses Platts Dubai and DME Oman crude oil for Asia and the Intercontinental Exchange (ICE) Brent futures price for Europe. The September OSP for Arab Light to Asia increased by 30 cents/b to a $3.50/b premium, and the price to Northwest Europe increased by $2.00/b to $5.80/b premium (Figure 4). The October OSP to Asia increased to a $3.60/b premium while the OSP to Northwest Europe dropped slightly to a $5.70/b premium.

The extent and duration of the current market dynamics, with sour crude oil prices trading unusually high, remain uncertain. On the supply side, OPEC+ and Saudi Arabia’s crude oil production and OSPs will have direct impacts on the price of sour crude oil. Demand for sour crude oil may increase as new Middle East refineries come on line, providing additional support for sour crude oil prices. In Oman, the 230,000 b/d Duqm refinery (a joint venture between Oman’s OQ Group and Kuwait Petroleum International) is scheduled to be completed by the end of 2023 and its feedstock is mainly sour and heavy crude oils. Kuwait’s Al Zour refinery is currently operating at 410,000 b/d, with a target capacity of 615,000 b/d by the end of 2023. U.S. refineries may face additional competition for sour barrels if the Trans Mountain Pipeline in Canada comes online in early 2024 as planned. The Trans Mountain Pipeline will move heavy sour Western Canada Select (WCS) crude oil to the west coast of Canada and the U.S., away from U.S. refining centers.

For questions about This Week in Petroleum, contact the Petroleum and Liquid Fuels Markets Team at 202-586-5840.

Source: US Energy Information Administration

Source: US Energy Information Administration

September 6, 2023

---

U.S. commercial buildings in cold or very cold climates were more than five times more energy intensive for space heating than buildings in hot or very hot climates, according to our latest Commercial Buildings Energy Consumption Survey (CBECS). Specifically, commercial buildings in cold or very cold climates consumed an average of 36,100 British thermal units per square foot, but buildings in hot or very hot climates consumed an average of 6,300 British thermal units per square foot.

The energy intensity for heating commercial buildings in the United States depends on the climate in which the building is located. The climate zones in our 2018 CBECS are based on the climate zones in ANSI/ASHRAE Standard 169-2021, Climatic Data for Building Design Standards. This standard designates climate zones using annual average temperature and precipitation data from 1994 to 2019.

Energy intensity in buildings is the energy consumed per square foot of floorspace. We calculate space heating energy-intensity estimates for CBECS by dividing the consumption of major fuels (electricity, natural gas, district heat, and fuel oil) for space heating by the total floorspace of the building that uses one of those fuels for space heating in each climate zone.

Commercial buildings in cooler climate zones were both more likely to be heated and to heat larger portions of their floorspace. In the cold or very cold climate zone, 62% of buildings reported heating all of their floorspace, but in the hot or very hot climate zone, 40% of buildings reported heating all of their floorspace.

Natural gas is the predominant energy source used for space heating in U.S. commercial buildings, accounting for 73% of the 2,167 trillion British thermal units of major fuels consumed for space heating in 2018. District heat accounted for the next-highest percentage of U.S. commercial space heating (12%), followed closely by electricity (11%). Fuel oil accounted for 4% of U.S. commercial space heating energy consumption. An additional 558,000 buildings (11% of U.S. commercial buildings with space heating) use other sources that aren’t included in major fuels consumption, such as propane and wood, for space heating.

The mixed mild climate zone had the lowest share of natural gas consumed for space heating in U.S. commercial buildings (68%) and the highest share of district heat consumed for space heating (18%). The hottest climate zone had the highest share of electricity consumed for space heating (18%), and the coldest climate zone had the highest share of fuel oil consumed for space heating (6%).

In 2018, furnaces were the most common heating equipment reported for heated commercial buildings in the cold or very cold climate zone (44%) and in the cool climate zone (47%). In contrast, packaged heating units were the most common heating equipment in mixed mild (40%), warm (58%), and hot or very hot climate zones (70%) among buildings that reported using energy for heating.

CBECS is the only nationally representative survey that collects information about U.S. building characteristics and energy use in commercial buildings. CBECS publishes a variety of data including building size, activity, energy sources, energy end uses, operating hours, and more.

The CBECS survey process spans more than four years, from developing the sample frame and survey questionnaire to releasing data to the public. Our final 2018 CBECS data were released in December 2022.

Principal contributors: Zack Marohl, Stacy Angel

Source: US Energy Information Administration

September 5, 2023

---

In January 2023, U.S. production capacity of renewable diesel and other biofuels reached 3 billion gallons per year, surpassing U.S. biodiesel production capacity for the first time. Rising targets for state and federal renewable fuel programs and the renewal of biomass-based diesel tax credits are driving this growth in U.S. renewable diesel capacity.

We began collecting data about U.S. capacity of renewable diesel and other biofuels in 2021. Since 2021, renewable diesel and other biofuels production capacity has more than tripled in the United States. Over the same period, biodiesel capacity has declined 13%. Renewable diesel is a fuel that is chemically equivalent to petroleum diesel and nearly identical in its performance characteristics. The same is not true of biodiesel, which is chemically different from petroleum diesel.

Nationwide, overall biofuels production capacity—which includes renewable diesel, biodiesel, ethanol, and other biofuels—reached 23 billion gallons per year (gal/y) in January 2023, a 6% increase in total production capacity from January 2022. Fuel ethanol accounted for 78% of U.S. biofuel production capacity, renewable diesel and other biofuels accounted for 13%, and biodiesel accounted for 9%.

---

Between January 2022 and January 2023, the U.S. production capacity for producing renewable diesel and other biofuels increased by 1.25 billion gallons per year, a 71% increase from 2022. In January 2023, 11 states reported sites with renewable diesel and other biofuels production capacity, up from 6 states in 2022. An example of a state with new and growing capacity is Texas, which had no renewable diesel and other biofuels capacity in January 2022. By January 2023, Texas had 537 million gal/y of capacity, the second highest after Louisiana. Unlike ethanol and biodiesel, where states in the Midwest hold most of the national capacity, more than 60% of U.S. renewable diesel and other biofuels production capacity is on the Gulf Coast.

Biodiesel now accounts for the smallest share of U.S. biofuels capacity, 2.1 billion gal/y in January 2023, among the three categories we track. Biodiesel capacity declined by 169 million gal/y from January 2022 to January 2023. The Midwest has 70% of U.S biodiesel capacity, which is primarily in Iowa, Missouri, Illinois, and Indiana.

Fuel ethanol producers in the Midwest continue to hold the most capacity in the U.S. biofuels market. Fuel ethanol capacity increased by 283 million gal/y between 2022 and 2023. More than 90% of U.S. ethanol capacity is in the Midwest, where the feedstocks for ethanol (primarily, corn) are grown, mainly in Iowa, Nebraska, Illinois, and South Dakota.

On August 7, we updated three of our biofuels reports: our 2023 Fuel Ethanol Plant Production Capacity Report, 2023 Biodiesel Plant Production Capacity Report, and 2023 Renewable Diesel Fuel and Other Biofuels Plant Production Capacity Report. These reports contain our most up-to-date estimates of plant production capacity for the U.S. biofuels industry. The reports include biofuels production capacity for operating plants as of January 1, 2023, with the names of the reporting plants organized by state and region.

Principal contributors: Chris Buckner, Kimberly Peterson

Source: US Energy Information Administration

August 31, 2023

---

On the Monday before the Labor Day weekend, August 28, 2023, the retail price of regular gasoline averaged $3.81 per gallon (gal) across the United States. Over the past five weeks, oil production cuts by Saudi Arabia, low U.S. gasoline inventories, and announced refinery maintenance in the Northeast have increased the regular gasoline retail price by 6%, or 22 cents/gal.

According to our Gasoline and Diesel Fuel Update, after adjusting for inflation (real terms), retail gasoline prices going into this Labor Day weekend were 4%, or 14 cents/gal, lower than last year.

Recent production cuts by Saudi Arabia and other OPEC+ members are putting upward pressure on crude oil prices (the largest component of the gasoline price). Production cuts by OPEC+ members in April did not affect crude oil prices much because concerns about slowing economic growth drove expectations that crude oil demand would remain steady or decline. This time, successive rounds of cut announcements beginning in June and recent data showing improving economic conditions in the United States are raising the price of crude oil.

Ahead of this Labor Day, Hurricane Idalia is affecting U.S. Gulf Coast production and pipeline facilities. Hurricane-induced facility closures can have uncertain effects on the retail price of gasoline, and the scale of the impact relates to the duration and severity of the closures.

Limited gasoline supplies have also contributed to higher gasoline prices. Refinery outages caused by extreme weather and refinery maintenance originally scheduled for last year have kept U.S. gasoline inventories below the previous five-year average since March 2022. Most recently, we expect planned maintenance for Irving Oil’s refinery (320,000 barrels per day [b/d]) in Saint John, New Brunswick, and Monroe Energy’s refinery (185,000 b/d) in Trainer, Pennsylvania, which will run from mid-September to mid-November, to keep gasoline supplies limited, especially in the Northeast. The East Coast is the highest-consuming gasoline market in the United States, but it has relatively little refinery capacity.

---

U.S. gasoline prices vary regionally, reflecting local supply and demand conditions, different fuel specifications required by state laws, and taxes. Regional gasoline prices are usually the highest on the West Coast due to the region’s limited connections with other major refining centers (including the Gulf Coast), tight local supply and demand conditions, and requirements for gasoline specifications that make gasoline more costly to manufacture. West Coast prices as of August 28 were $4.88/gal, up 2%, or 10 cents/gal, from the same time last year. The Rocky Mountains region faces similar logistical constraints as the West Coast, although overall supply and demand in the region are both lower. Rocky Mountain gasoline retail prices averaged $3.98/gal, a 1%, or 4 cents/gal, decrease over 2022.

The Gulf Coast accounted for 54% of the country’s total refining capacity as of January 2023, and it produces more gasoline than it consumes. As a result, the price of gasoline on the Gulf Coast is often the lowest in the United States. On August 28, the average retail gasoline price for the Gulf Coast was $3.38/gal, up 1%, or 2 cents, from the same time last year.

On the East Coast, retail gasoline prices were $3.64/gal on August 28, down 1%, or 4 cents, compared with the same time last year. Midwest prices decreased 1%, or 4 cents, to $3.68/gal.

Principal contributor: Alex de Keyserling