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Energy Security Fact Pack 216 @Securing_Energy #SAFEenergyfacts

ENERGY SECURITY FACT PACK Contents 1. 2. 3. 4. 5. 6. QUARTER SUMMARY CHARTS OF THE QUARTER U.S. OIL SUPPLY, DEMAND, AND TRADE GLOBAL OIL MARKET DYNAMICS OIL DEPENDENCE AND ENERGY SECURITY SOLUTIONS AND ALTERNATIVES SAFE s Energy Security Fact Pack provides a data-driven overview of the latest trends in U.S. energy security, including domestic and global oil production and consumption, oil market dynamics, energy prices, consumer spending on oil, fuel efficiency, and alternative fuel vehicles. 1

QUARTER SUMMARY 216: Energy in the Election Despite its relevance to U.S. economic productivity and national security, energy has been largely sidelined in the 216 presidential election. However, expect energy to remain at the fore in the upcoming presidential term. Critical issues include the mid-term review of fuel economy standards, regulation of drilling on federal lands and the potential opening of new territories for offshore drilling, regulation of methane emissions from hydraulic fracturing, pipeline approvals, federal support for energy R&D, regulation of autonomous vehicles, and much more. Charts of the Quarter highlight historical gasoline prices on election day, crude oil production during previous presidential administrations, and other topics: Despite the recent surge in domestic oil production and lower net imports, the United States is not energy independent. The country remains reliant on large volumes of crude oil and refined products whose prices are set in a global market [Pages 4, 5 & 6]. This market is subject to unpredictable and sometimes anti-competitive behavior from oil-producing countries that supply it, most notably OPEC members [Page 1]. Most oil and natural gas resources on federal lands remain off-limits for development by government restriction [Page 7]. The decline in oil prices has stressed the energy sector. More than 187, oil and natural gas jobs have been lost since employment peaked in late 214 [Page 8]. Reducing the energy intensity of the U.S. economy through improvements in efficiency and use of alternative fuels in the transportation sector will strengthen resilience to oil price volatility and increase U.S. energy security [Page 9]. 2

CHARTS OF THE QUARTER U.S. Crude Oil Production by Presidential Administration Crude oil production in the United States began in Pennsylvania in 1859. It increased initially through 197 before beginning more than three decades of gradual decline in the mid-198s. It increased once again with the onset of the shale oil revolution in 29. 12 Million Barrels per Day 1 Eisenhower Johnson Nixon Ford Carter Reagan Bush 41 Clinton Bush 43 Obama Kennedy 8 6 4 2 196 1965 197 1975 198 1985 199 1995 2 25 21 215 Note: Preliminary 216 estimate for U.S. crude oil production. Dotted line shows the length in time of each presidential term. Source: EIA 4 8

CHARTS OF THE QUARTER United States Is Not Energy Independent Although U.S. net oil imports have fallen 6% since 25, the country remains reliant on imported oil. In, net imports rose to 5. mbd (+.2 mbd, or roughly 4%, year-over-year (y-oy)). The United States became a net exporter of petroleum products in 211. 14 Million Barrels per Day Monthly Petroleum Trade Deficit (Percent of Total) 7% 12 6% 1 5% 8 4% 6 3% 4 2% 2 1% % -2-1% -4 Petroleum Products Crude Oil Trade Deficit in Petroleum (RHS) 23 24 25 26 27 28 29 21 211 212 213 214 215 216-2% Source: SAFE analysis based on data from EIA 5 13

CHARTS OF THE QUARTER Real Gasoline Prices on Election Day The price of gasoline is an important issue for voters on election day. This year, the price of gasoline roughly $2.25 per gallon on average nationwide is substantially lower than it was in 212, but similar to 28. 4. 3.5 Dollars per Gallon Carter Reagan Obama Obama 3. 2.5 Ford Carter Reagan Reagan Bush 43 Bush 43 2. Bush 41 Clinton Bush 43 Obama? 1.5 Bush 41 Clinton Clinton 1..5 Gasoline Price. 1976 198 1984 1988 1992 1996 2 24 28 212 216 Source: SAFE analysis based on data from EIA 6 8

CHARTS OF THE QUARTER Most U.S. Oil and Gas Resources Restricted or Inaccessible Approximately 232 billion barrels of undiscovered technically recoverable oil and gas resources are held within federal lands and waters, yet 63% (147 billion barrels) is restricted or inaccessible. The Alaska OCS contains most of these resources (49.8 billion barrels). Eastern Gulf of Mexico Billion Barrels Oil Equivalent Atlantic OCS Pacific OCS Accessible Limited Accessibility / Restrictions Inaccessible Western Gulf of Mexico Northern Alaska Lower-48 Onshore Alaskan OCS Central Gulf of Mexico 1 2 3 4 5 6 Source: DOI 7

CHARTS OF THE QUARTER Steep Job Cuts Shake Oil Sector Oil sector employment has been significantly affected by the decline in global oil prices. As of March 216, at least 187, jobs were lost since peak employment in September 214. More than 6% of these were in the support subsector (-8, employees y-o-y in March 216). 1 Thousand Employees (Change, Y-o-Y) Dollars per Barrel $15 5 $12 $9-5 $6-1 $3 Drilling Support Extraction Brent crude oil price (RHS) -15 $ 27 28 29 21 211 212 213 214 215 216 Note: Support and Extraction data points for August and September 216 are preliminary. Drilling data is only available through March 216. Source: SAFE analysis based on data from Bureau of Labor Statistics and EIA 8 24

CHARTS OF THE QUARTER Oil Intensity Flat While Household Expenditures Fall U.S. oil intensity remained unchanged in at.43 barrels per $1, of GDP. However, household spending on petroleum fuels is down 14% y-o-y, at an annualized level of $268 billion, due to lower oil and petroleum product prices..65 Oil Intensity (Barrels of Oil Consumed per $1, of GDP) Billion Dollars (Annualized) 6 Gasoline and Other Motor Fuels (RHS) Fuel Oil and Other Fuels (RHS).6 5 Other (RHS) Oil Intensity.55 4.5 3.45 2.4 1.35 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA and BEA 9 8

CHARTS OF THE QUARTER No Free Market for Oil OPEC spare crude oil production capacity fell to just 1. million barrels per day (mbd) at the end of. This is equivalent to approximately 1% of global consumption. The majority of OPEC s spare production capacity is held by Saudi Arabia. 1 Million Barrels per Day Percentage 1% 9 8 7 OPEC Spare Crude Oil Production Capacity Spare Capacity as a Percentage of World Liquids Consumption (RHS) 9% 8% 7% 6 5 4 Spare capacity as a share of world liquid fuels consumption falls below 1% as Saudi Arabia, Iran and others continue to increase production. 6% 5% 4% 3 3% 2 2% 1 1% 2 22 24 26 28 21 212 214 216 % Source: SAFE analyis based on data from EIA 1 21

U.S. OIL SUPPLY, DEMAND, AND TRADE U.S. Oil Producers Remain Under Pressure The U.S. oil rig count increased from 33 to 425 rigs in, a 29% increase quarter-over-quarter (q-o-q) after falling to its lowest point since 29 in. U.S. crude oil production nevertheless continued to decline, falling.3 mbd q-o-q in 216. 1,8 Rig Count Thousand Barrels per Day 12, U.S. Crude Oil Production Oil Rig Count (LHS) 1,5 1, 1,2 8, 9 6, 6 3 EIA expects output to remain steady before increasing at the end of 217. 4, 2, 24 25 26 27 28 29 21 211 212 213 214 215 216 217 Source: EIA and Baker Hughes 12 8

U.S. OIL SUPPLY, DEMAND, AND TRADE U.S. Oil Production Continues to Fall U.S. liquids production fell.8 mbd y-o-y in. Inclusive of fuel ethanol and natural gas liquids (NGLs), total U.S. liquids production remains approximately 6. mbd higher than in 28, making the U.S. the world s largest liquids producer. 16 Million Barrels per Day 14 12 Crude Oil Fuel Ethanol NGLs 1 8 6 4 2 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 13 1

U.S. OIL SUPPLY, DEMAND, AND TRADE Y-o-Y Transportation Fuel Demand Growth Slows U.S. demand for gasoline, diesel, and jet fuel averaged 14.7 mbd in, declining 1% y-o-y. Total vehicle miles traveled (VMT) has increased y-o-y for ten consecutive quarters. In, VMT rose by approximately 2.3% (+26 million miles y-o-y, slightly lower than in recent quarters). 1.2 Million Barrels per Day (Change, Y-o-Y) Million Miles per Day (Change, Y-o-Y) 4.9 3.6 2.3 1. -.3-1 -.6-2 -.9-1.2 Transport Fuels VMT (RHS) 23 24 25 26 27 28 29 21 211 212 213 214 215 216-3 -4 Source: SAFE analysis based on data from EIA 14 11

U.S. OIL SUPPLY, DEMAND, AND TRADE Imports From OPEC Climbing U.S. crude oil and petroleum product imports reached 1.4 mbd in (+.8 mbd y-o-y), the highest in four years. Since 215, OPEC s share has steadily risen to 34% of imports (3.6 mbd), with Saudi Arabia the leading source (1.1 mbd). 16 Million Barrels per Day 14 Saudi Arabia Venezuela Other OPEC Canada Mexico Other Non-OPEC 12 1 8 6 4 2 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analyis based on data from EIA 15 11

GLOBAL OIL MARKET DYNAMICS Global Oil Supply Growth Continues to Slow Driven by an overall decline in total U.S. liquids supply (-.7 mbd y-o-y), global oil production fell.1 mbd y-o-y in, the first contraction since 213. The United States accounted for more than 82% of net global supply growth between 212 and 216. 5 Million Barrels per Day (Change, Y-o-Y) 4 3 2 1-1 -2-3 -4-5 United States Liquids Saudi Arabia Crude Total Other non-opec Liquids and OPEC non-crude (NGLs) Other OPEC Crude 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 17 15

GLOBAL OIL MARKET DYNAMICS Global Oil Demand Edges Upward Global oil demand grew by approximately.7 mbd y-o-y in driven by growth in non-oecd countries (+1.2 mbd y-o-y). Demand in OECD countries fell.5 mbd y-o-y in to 46.4 mbd. Global oil demand has been increasing since 29, reaching approximately 95.9 mbd in. 5 Million Barrels per Day (Change, Y-o-Y) 4 3 2 1-1 -2-3 -4-5 United States Other OECD China Other non-oecd Total 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 18 16

GLOBAL OIL MARKET DYNAMICS Non-OPEC Supply Growth Stays Negative Non-OPEC supply encountered a second consecutive quarter of decline (-1. mbd y-o-y). Global oil demand growth has exceeded non-opec liquids supply growth for the past six quarters, a reversal versus 213 to 215, and a pattern last seen between 212 and 213. 5 Million Barrels per Day (Change, Y-o-Y) 4 3 2 1-1 -2-3 -4-5 -6 Global Demand Non-OPEC Liquids and OPEC non-crude (NGLs) 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 19

GLOBAL OIL MARKET DYNAMICS Unplanned Crude Oil Outages Remain High Global unplanned outages fell in (-.4 mbd q-o-q) as Canadian production returned following wildfire disruptions in. Among OPEC countries, Iran continues to bring additional oil supplies online. However, political instability in Nigeria and Libya extends disruptions. 4. Million Barrels per Day 3.5 3. 2.5 Non-OPEC Kuwait Libya Iran Saudi Arabia Iraq Nigeria 2. 1.5 1..5. 212 213 214 215 216 Source: SAFE analysis based on data from EIA 2

GLOBAL OIL MARKET DYNAMICS Barrels at Risk Map Total oil supply outages averaged 2.8 mbd in. Attacks on oil infrastructure increased outages in Nigeria s main oil-producing region, the Niger Delta, while tensions in Venezuela, Libya, and other countries also threaten to further increase outages. 21 2

OIL DEPENDENCE AND ENERGY SECURITY Light Truck Market Share Hits Record High New light truck sales soared to 1.7 million units in 216. Light trucks now account for 61% of new light-duty vehicle (LDV) sales, the highest share since the summer of 25. Total seasonally adjusted LDV sales in were roughly 5% higher than 29 levels, at 17.8 million units. 21 Million Units Light Truck Share of Sales 9% Light Truck Sales Car Sales Share (RHS) 18 8% 15 7% 12 6% 9 5% 6 4% 3 3% 23 24 25 26 27 28 29 21 211 212 213 214 215 216 2% Source: SAFE analysis based on data from BEA 23 24

OIL DEPENDENCE AND ENERGY SECURITY Brent and WTI Prices Hold Steady Prices of domestic petroleum products like gasoline and diesel correlate closely with prevailing global crude oil benchmarks. Oil and product prices held steady after q-o-q increases in H1 216. September average Brent = $46.57/bbl, WTI = $45.18/bbl, U.S. gasoline = $2.16/gal. 2 Dollars per Barrel 18 16 14 12 1 8 6 4 2 Price of WTI Crude Oil Price of U.S. Gasoline Price of Brent Crude Oil Price of U.S. Diesel 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 24 23

OIL DEPENDENCE AND ENERGY SECURITY Oil Price Volatility Remains Elevated Global oil prices have been volatile since they began their initial slide during the summer of 214. Volatility averaged 55% in H1 216 versus 15% in H1 214. Although down from 69% in, 3-day volatility averaged 42% in and 41% in. 15 Dollars per Barrel Volatility 15% Monthly Volatility (Annualized) (RHS) Oil Price 12 12% 9 9% 6 6% 3 3% % 23 24 25 26 27 28 29 21 211 212 213 214 215 216 Source: SAFE analysis based on data from EIA 25 24

SOLUTIONS AND ALTERNATIVES Retail Liquid Fuel Prices Uptick Liquid fuel prices have experienced substantial volatility since 2. Despite a more recent uptick, in 216 they have fallen to multi-year lows. Meanwhile, the prices of compressed natural gas (CNG) and electricity have remained relatively stable during the same time period. 6 Dollars per Gasoline Gallon Equivalent (GGE) 5 4 3 2 1 Gasoline E85 CNG Propane Diesel B2 B99/B1 Electricity 2 22 24 26 28 21 212 214 216 Source: SAFE analysis based on data from Clean Cities Alternative Fuel Price Reports 27 26

SOLUTIONS AND ALTERNATIVES New Light-Duty Vehicle Fuel Economy Ratings Steady The average fuel economy rating of new light-duty vehicle sales remained steady y-o-y in at 25.3 miles per gallon, a marked change versus MY 28 to 214 when it consistently increased. MY 216 fuel economy was 25.3 mpg, approximately 19% higher than 29 levels. 26 Miles per Gallon 25 Model Year Average MY 214 MY 215 MY 216 24 Monthly Average MY 213 23 MY 212 22 MY 211 21 MY 29 MY 21 2 MY 28 28 29 21 211 212 213 214 215 216 Note: Average sales-weighted fuel-economy rating of purchased new light-duty vehicles. Source: SAFE analysis based on data from Michael Sivak and Brandon Schoettle, University of Michigan Transportation Research Institute 28 27

SOLUTIONS AND ALTERNATIVES Plug-in Electric Vehicle Sales Reach New Historic High Approximately 45, plug-in electric vehicles (PEVs) were sold in (+63% y-o-y), the best quarter on record. Popular models included Tesla s Model S and Model X, as well as the Chevrolet Volt. The six best-selling vehicles accounted for approximately 72% of total sales. 5, Units Sold 4, 3, GM Ford Toyota Others Nissan Tesla BMW Volkswagen 2, Fiat 1, 211 212 213 214 215 216 Source: SAFE analysis based on data from HybridCars.com 29 28

SOLUTIONS AND ALTERNATIVES More PHEV Models Available, but EVs Majority of Sales The number of PHEV models available increased from 11 to 16 y-o-y through the end of. However, EVs still account for the majority of plug-in electric vehicle sales (roughly 59% in ). More than 5, PHEVs and EVs have been sold in the United States. 3 Models Available Cumulative Units Sold 6, 25 5, PHEV EV Cumulative Sales (RHS) 2 4, 15 3, 1 2, 5 1, 211 212 213 214 215 216 Note: Several available models are not included in "Cumulative Sales." Source: SAFE analysis based on data from HybridCars.com 3 28

SOLUTIONS AND ALTERNATIVES Alternative Fueling Stations Continue to Climb The number of alternative fueling stations nationwide increased 89% between 213 and 216, a net addition of approximately 24,1 stations. The vast majority of these new additions (94%) were for electric charging. 6 Count at End of Period (Thousands) Propane LNG Hydrogen CNG Biodiesel E85 Electric 5 4 3 2 1 25 26 27 28 29 21 211 212 213 214 215 216 216 216 Note: Starting in 211, electric charge equipment was counted by the plug rather than by the geographic location. This is different than other fuels, which only count the geographic location regardless of how many dispensers or nozzles are on site. Source: Alternative Fuels Data Center 31 31

ENERGY SECURITY FACT PACK About, Links, and Contact ABOUT Securing America s Future Energy (SAFE) is a nonpartisan, not-for-profit organization committed to reducing America s dependence on oil and improving U.S. energy security in order to bolster national security and strengthen the economy. SAFE has an action-oriented strategy addressing politics and advocacy, business and technology, and media and public education. SAFE s Energy Security Fact Pack, launched in 214, provides a data-driven overview of the latest trends in U.S. energy security, including domestic and global oil production and consumption, oil market dynamics, energy prices, consumer spending on oil, fuel efficiency, and alternative fuel vehicles. WEB LINKS SAFE: www.secureenergy.org Electrification Coalition: www.electrificationcoalition.org The Fuse: www.energyfuse.org @Securing_Energy #SAFEenergyfacts CONTRIBUTORS Paul Ruiz, Policy Analyst Pi Praveen, Policy Fellow Andrea Alie, Policy Intern Zachary Waller, Policy Intern MEDIA CONTACT For media inquires please contact Leslie Hayward, lhayward@secureenergy.org or (22) 461-2364. 32 32

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