Valero Energy Corporation (VLO): U.S. Still Reliant On Saudi Imports

After all, they had no idea that advances in drilling technologies would unleash a domestic oil boom of epic proportions and thought the nation would continue to import more and more oil from the Saudis. So because they don’t want to let their upgraded facilities sit idle, Saudi and Canadian oil remains in high demand.

Meanwhile, though, U.S. refiners have managed to drastically slash imports of light, sweet crude oil — most notably from Nigeria and Angola — thanks to booming production from US shale plays. For instance, Valero Energy Corporation (NYSE:VLO) has replaced all light oil imports with domestic substitutes at its Gulf Coast and Memphis refineries, while Phillips 66 (NYSE:PSX) recently said it hopes to process 100% North American crudes at its refineries nationwide within a couple of years.

Final thoughts
The oil import story isn’t as cut-and-dried as one would expect. Important distinctions in the physical qualities of different types of crude oil continue to dictate U.S. refinery demand for them. So even as the U.S. oil boom has helped sharply reduce American dependence on countries that produce light, sweet crude oil, it hasn’t lessened our reliance on Saudi and Canadian oil, for which demand is likely to stay strong for years to come.

The article What Saudi Arabia Thinks About the U.S. Oil Boom originally appeared on Fool.com and is written by Arjun Sreekumar.

Fool contributor Arjun Sreekumar and The Motley Fool have no position in any of the stocks mentioned.

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