Because the CFS does not include shipments from NAICS subsector 211: Oil and Gas Extraction, transportation of crude petroleum is an OOS commodity for the CFS.  Only one commodity code is covered in this OOS segment, which is SCTG 16 Crude Petroleum Oil.  This includes shipments from the field or marine terminals, international pipelines to refineries or long-term storage facilities.  Unlike other OOS-components discussed thus far, foreign trade crude petroleum shipments in addition to domestic crude movements are also addressed in this section.

9.1 SIGNIFICANCE OF CRUDE PETROLEUM

Crude petroleum is one of the major OOS components for the CFS.  As an example, Table 9–1 presents statistics for domestic and imported crude petroleum.  Domestic production of crude petroleum has increased since 2007, with a 28% increase in domestic volume from 2007 to 2012.  On the other hand, imported volumes showed a decline over time, as the 2012 volume was about 16% lower than that in 2007. 

Table 9–1 .  Volume of Crude Petroleum (in million barrels)

Although small, U.S. crude petroleum exports also have seen a slight increase in recent years. Note that the U.S. more commonly exports coal, gasoline, and natural gas to other countries.  However, for the most part, U.S. companies are not allowed to export crude oil; due to a ban that was put in place in 1975²⁸.  There are exceptions in selected circumstances, thus some amounts for crude petroleum exports are seen in Table 9–1 .  For 2012, nearly all of the exported crude petroleum went to Canada, with only a small portion exported to Mexico in 2012. 

9.2 DATA SOURCES

As in FAF3, basic information on crude production, imports, exports, and related activities at refineries can be estimated using data collected by the Energy Information Administration (EIA), a part of the U.S. Department of Energy (DOE).  Note that geographic regions for the EIA data are typically in the Petroleum Administration for Defense Districts (PADD).  Figure 9–1 displays a map of the PADDs as defined by the EIA.

Figure 9–1 .  Definition of Petroleum Administration for Defense Districts (PADDs).

9.2.1 EIA Data

Several tables published by the EIA provide the fundamental statistics needed in estimating 2012 crude petroleum volumes and their flows. 

Movement of Crude by Rail

The Movement of Crude by Rail table contains monthly and annual rail crude oil movements as well as providing crude movements regions²⁹.  This crude by rail table provides detailed movements among PADDs as well as trade between PADDs and Canada.  It provides control totals for domestic, U.S. exports to Canada, and U.S. imports from Canada on crude by rail.

Company-Level Imports

The Company-Level Imports database contains monthly statistics on imports of crude and petroleum products at the company level.  Specific information provided in this database includes importing company name and country, product name, port of entry location (city, state, PADD), import quantity (in thousand barrels), and so forth.  This database is available in Microsoft Excel spreadsheet format³⁰ from the EIA website.  Because of reporting differences, the EIA noted that summation of volumes for PADDs 1-5 from the company-level imports would not equal aggregate import totals.

Crude Petroleum Production

The Crude Petroleum Production table contains the annual production of crude petroleum, in thousands of barrels by state and PADD³¹.  The statistics published in this EIA table are based on amounts reported from states.  The EIA notes that state production estimates reported by the EIA are normally different from those reported by state agencies.  One explanation of this difference can be found in Today in Energy, released on July 10, 2015³².  As that article pointed out, the reason for this difference was that the EIA’s estimates accounted for expected revisions to data collected by the states.

Exports by Destination Country

In 2012, the only exported crude petroleum from the U.S. was a total of approximately 24.7 million barrels to Canada and about 5 thousand barrels to Mexico³³.  The U.S. crude petroleum exports have been restricted to (1) crude petroleum derived from fields under the State waters of Alaska's Cook Inlet; (2) Alaskan North Slope crude petroleum; (3) certain domestically-produced crude petroleum destined for Canada; (4) shipments to U.S. territories; and (5) California crude petroleum to Pacific Rim countries.  Recently, the U.S. Congress has approved a measure to repeal the 40-year ban on crude oil exports, allowing energy companies to export U.S. crude petroleum. 

Exports by PADD District

In addition to the country-level total, annual volumes of crude petroleum (in thousand barrels) exported from each PADD³⁴ is also available from the EIA.  This provides control totals for exported crude by PADD.

Movements by Mode between PADDs

Annual volumes of crude petroleum movements (measured in thousand barrels) by different transportation modes (including pipeline, tanker, barge, and rail) between PADDs are published by the EIA³⁵.  The statistics published in this EIA table were based on information collected from state-reported EIA forms, specifically the EIA-813 (Monthly Crude Oil Report).

Refinery Net Input

The EIA also publishes annual data on refinery net inputs for crude petroleum by PADD and refining regions (sub-PADD level)³⁶.  These statistics represent total crude petroleum (domestic plus foreign) input to crude petroleum distillation units and other refinery processing units.

9.2.2 Carload Waybill Sample 2012

The Surface Transportation Board (STB) publishes and maintains the Carload Waybill Sample³⁷ database, which is a stratified sample of carload waybills for all U.S. rail traffic submitted by those rail carriers terminating 4,500 or more revenue carloads annually.  The 2012 Carload Waybill Sample database captured over 623 thousand waybills reported electronically in 2012.  In order to protect sensitive shipping and revenue information of rail companies reporting the Waybill, STB provides a public-use version of the Waybill data that contains aggregated data, in addition to the more detailed limited-access confidential version.

9.2.3 County Business Patterns

As in other OOS components, the 2012 CBP data is also used as a data source in the estimation process of this industry.

9.3 ESTIMATION PROCESSES

9.3.1 Domestic Crude Flows

The EIA data on movements between PADDs provided the control totals for estimating domestic movements of crude oil at the PADD level.  The need here is to disaggregate crude petroleum movements from the PADD-level to the desired FAF-zone level.  Since the crude petroleum flows have different OD patterns by transportation mode, the PADD-to-PADD crude petroleum flows are constructed in different matrices by each transportation mode.  The basic process is described in the following steps:

1. Obtain PADD-level movements by different modes (pipeline, water, and truck) using the EIA “Movement between PAD Districts” table.
2. Estimate FAF-zone level crude production so that it can be used as a production factor in the gravity model (a spatial interaction model, see Step 4).  According to the EIA crude petroleum production data, 31 states produced crude petroleum in 2012.  The CBP payroll shares for “Crude Petroleum and Natural Gas Extraction” industry (NAICS code 211111) are used to disaggregate total state-level production volume to county-level, and then are aggregated to generate FAF–zone level crude petroleum production estimates.
3. Estimate refinery input (i.e., consumption) at FAF-zone level.  These are used as an attraction factor in the gravity model.  Note that the refinery input data provided by the EIA is at the state level.  To estimate the FAF-zone level consumption, this state level consumption is distributed proportionally to the operation capacity of each crude petroleum refinery and aggregated to the corresponding FAF-zone level.  The assignment of refineries to the associated FAF zone was done with the aid of a GIS tool.  Refinery locations are geo-coded first and then spatially joined with the FAF zone data layer.
4. Execute rank-based gravity model and apply the IPF model to estimate FAF regional-level movements.  This process used PADD-to-PADD movements as the control totals.  With each PADD-PADD pair, the rank-based gravity model is used to generate an initial OD flow matrix, and then follow by IPF model to obtain final estimates.  These processes are repeated for all PADD-PADD pairs by mode. 

9.3.2 Flows of Imported Crude

Imports by Rail (Trans-Border Only)

The process of determining the flow of imported crude oil by rail began by deriving imported crude oil shipment patterns from the 2012 Waybill data.  The Waybill data was used to determine foreign origin, domestic origin, and domestic destination for each imported shipment.  It should be noted that the domestic origin of an import shipment was estimated based on the first “through state” from the Waybill.  Assuming the Waybill data captured the import pattern (by rail), the waybill-estimated patterns (by weights) are used to distribute EIA-based control totals.  Note that the shares are calculated based on Waybill estimates for each foreign origin-PADD pair and then applied to EIA numbers to get estimated shipment weights for the FAF.

Imports by Other Modes

The process of determining the flow of imported crude oil by all other modes began with subtracting imports by rail from EIA company-level imports data.  Then the assignment of foreign-mode and domestic-mode for remaining imports was done.  The foreign mode was determined by reviewing foreign country and port location for countries other than Canada (import mode was assumed to be water) and for Canada (import mode can be water or pipeline depending on port location’s access to water network and pipeline network.)  The domestic mode was the mode that can serve both port (domestic origin) and facility location (domestic destination).  After the mode assignment, the company-level imports totals are aggregated into FAF regions.  Finally, the value of crude oil is calculated using EIA data on imported crude oil price for each foreign region.

9.3.3 Flows of Exported Crude

According to the EIA data, crude oil was only exported to Canada and Mexico in 2012.  Modes involved for these exported crude shipments are rail and truck.

Exports by Rail

A similar process as used for imported crude by rail is used for exports.  Note that the weight shares are calculated based on Waybill estimates for each origin PADD- foreign country pair and applied to EIA numbers to get estimated weights for the FAF.  The value of crude oil is calculated based on EIA data on reported crude price.

Exports by Truck

Besides the crude exports by rail, the remaining crude exports are assumed to be via truck.  Based on EIA data obtained from the Exports by Destination table, only Canada and Mexico received crude petroleum from the U.S. in 2012.  The domestic origin of exported crude is assumed to be in the FAF region that produces crude oil.  The amount of originating flow was estimated using the product of the production share of its PADD and the total flow originating from the given PADD, as obtained from the Exports by PADD table.  Both domestic mode and foreign mode are assigned as truck for these shipments.  The value of crude oil is then calculated based on EIA-reported price to complete the resulting matrix.

²⁸ Energy Policy and Conservation Act of 1975, at: http://energylaw.uslegal.com/energy-policy-and-conservation/ and the Government Publishing Office PL94-163.

²⁹ Table “Movements of Crude Oil by Rail”, Petroleum & Other Liquids, U.S. EIA, at: http://www.eia.gov/dnav/pet/PET_MOVE_RAILNA_A_EPC0_RAIL_MBBL_M.htm.

³⁰ Data can be downloaded at EIA website: http://www.eia.doe.gov/oil_gas/petroleum/data_publications/company_level_imports/cli.html.

³¹ Annual crude oil production statistics is available from EIA website at: http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbbl_a.htm.

³² “EIA’s estimates for state crude oil production account for incomplete, lagged data,” Today in Energy, EIA, http://www.eia.gov/todayinenergy/detail.cfm?id=22012

³³ Table “Exports by Destination”, Petroleum & Other Liquids, U.S. EIA, at: http://www.eia.gov/dnav/pet/pet_move_expc_a_EP00_EEX_mbbl_m.htm.

³⁴ Table on crude oil “Exports”, Petroleum & Other Liquids, see EIA website: http://www.eia.gov/dnav/pet/pet_move_exp_dc_NUS-Z00_mbbl_m.htm.

³⁵ Table on Movements by Tanker, Pipeline, Barge, and Rail between PAD Districts, can be found at EIA website: http://www.eia.gov/dnav/pet/pet_move_ptb_a_EPC0_TNR_mbbl_a.htm.

³⁶ Refinery Net Input, Petroleum & Other Liquids, see EIA website: http://www.eia.gov/dnav/pet/pet_pnp_inpt2_a_epc0_YIY_mbbl_a.htm.  

³⁷ For access of Carload Waybill Sample data visit Surface Transportation Board website at: http://www.stb.dot.gov/stb/industry/econ_waybill.html, or access the 2012 documentation at: http://www.stb.dot.gov/stb/docs/Waybill/2012%20STB%20Waybill%20Reference%20Guide%20-%20FINAL.pdf.