Energy and Trade Good for the American Economy, Our Workers and Small Businesses

By at 12 April, 2024, 11:33 am

by Raymond J. Keating – 

The Biden administration and many in Congress often stand opposed to U.S. energy production and to free trade. These stances are, of course, politically driven, and make no economic sense.

In fact, it’s worth noting a few points that make clear that U.S. energy production and free trade often go hand-in-hand. Consider the following from the U.S. Energy Information Administration:

● On crude oil exports: “U.S. crude oil exports established a record in 2023, averaging 4.1 million barrels per day (b/d), 13% (482,000 b/d) more than the previous annual record set in 2022. Except for 2021, U.S. crude oil exports have increased every year since 2015, when the U.S. ban on most crude oil exports was lifted.”

● On LNG exports: “The United States exported more liquefied natural gas (LNG) than any other country in 2023. U.S. LNG exports averaged 11.9 billion cubic feet per day (Bcf/d)—a 12% increase (1.3 Bcf/d) compared with 2022…”

● On petroleum product exports: “Petroleum product exports from the United States averaged a record 6.1 million barrels per day (b/d) in 2023, a 2.5% increase from 2022…”

By the way, the EIA also reported: “The United States produced more crude oil than any nation at any time, according to our International Energy Statistics, for the past six years in a row. Crude oil production in the United States, including condensate, averaged 12.9 million barrels per day (b/d) in 2023, breaking the previous U.S. and global record of 12.3 million b/d, set in 2019. Average monthly U.S. crude oil production established a monthly record high in December 2023 at more than 13.3 million b/d.”

The following chart shows the dramatic increase in U.S. crude oil production over the past 15 or so years.

And as for natural gas production, consider the dramatic rise to record levels in the U.S. in the following chart.

The story of U.S. energy production has been nothing less than amazing since approximately 2005, and that’s been thanks to entrepreneurship, investment and innovation in such areas as hydraulic fracturing and horizontal drilling.

U.S. production and exports have been good news for the energy industry, which, by the way, is overwhelmingly about small businesses. For example, according to the latest data from the U.S. Census Bureau (2021), 96 percent of employer firms in the oil and gas extraction sector have fewer than 100 employees, and in the support activities for oil and gas operations sector, 96 percent of employer firms have fewer than 100 workers.

And small businesses dominate the numbers in other energy sectors, and of course, as consumers of energy.

Yes, energy production and open trade are good for the American economy, including for small businesses and their employees.

Raymond J. Keating is chief economist for the Small Business & Entrepreneurship Council. His latest books on the economy are The Weekly Economist: 52 Quick Reads to Help You Think Like an Economist, The Weekly Economist II: 52 More Quick Reads to Help You Think Like an Economist and The Weekly Economist III: Another 52 Quick Reads to Help You Think Like an Economist.


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