What I want to know, since we only consume a fraction of it, where is all that money going?
All that profit doesn't seem to be staying inside the US.
All that profit doesn't seem to be staying inside the US.
The U.S. is a net importer of both oil and natural gas:
http://www.eia.gov/dnav/pet/pet_move_wkly_dc_NUS-Z00_mbblpd_...
For example if the keystone pipeline was approved the majority of it would be for export, not domestic use.
A big driver of exports is simply the fact that lots of places don't have refinery capacity. People in such places are willing to pay more than people in the U.S., with its relative abundance of refineries.
The rest of the 'not consuming our own content' is just a logistics thing, the cheapest oil is generally used, not the oil that crosses the least borders.
I've been harping on this for years. You can produce billions of gallons of oil, but if you can't refine it, it's a loss leader and a big reason why our gas continues to hover around $4.
If we owned the whole cycle from drilling, production, refinement and consumption, it would be huge. Cutting out the refining middle man would save us billions and dramatically reduce the price per gallon. It's just simple supply and demand.
Just in case you wanted to know. .
http://www.eia.gov/tools/faqs/faq.cfm?id=29&t=6
The last refinery was built in 2008. Before that, in 1998. The majority of refineries were built in the 1970's - go figure, when oil was suddenly abundant and post OPEC embargo, very, very cheap.