Oil futures markets in April 2018 indicate that oil traders expected crude oil prices to trend at about $63 per barrel through the end of 2018, below actual market prices of close to $70 per barrel reached in early April 2018. In 2012, the average price of imported petroleum rose 1% over the same period in 2011 to reach an average price of $101.07 per barrel. Turmoil in the Middle East, natural disasters, hurricanes, droughts, the rate of economic growth in Asia and Europe, the prospects of Iranian oil exports, and the impact of low oil prices on U.S. investment and production of petroleum and natural gas—the United States is now the world's largest combined producer of oil and natural gas—likely will continue to have a significant impact on the course of oil prices for the foreseeable future. Despite fluctuations in oil prices and sharp drops at times in the average annual price of imported crude oil and the decline in the role of imported crude oil in the value of the U.S. trade deficit, the trade deficit itself did not change appreciably. In general, U.S. demand for oil imports responds slowly to changes in oil prices. Most importantly, the average price per barrel of crude oil in 2016 was $36 per barrel, down 34% from the average price of $47 per barrel in 2015. At current prices and volumes, energy imports in 2018 are projected to rise to about $200 billion, or about $25 billion more than in 2017. Oil Import Prices

Crude oil comprises the largest share of energy-related petroleum products imports. Crude oil prices rose from an average of $94 per barrel in January 2013 to $102 per barrel in September 2013, the highest average monthly value recorded up to that point in 2013, but fell to an average imported price of $91.34 in December 2013. Issues for Congress

The rise in the prices of energy imports in 2017 and early 2018, combined with a small increase in the total volume of energy imports, resulted in a larger contribution to the overall U.S. trade deficit in 2017 and 2018. Various factors, dominated by events in the Middle East, a slowdown in the rate of economic growth in Asia and other developing economies, and an increase in natural gas production in the United States, combined in 2015 to push the cost of energy imports slightly lower than in 2014.
Imported petroleum prices fell from an average price of $91.23 per barrel of crude oil in 2014 to an average price of $32.60 per barrel in 2016, or a drop of more than 60%. This represents the lowest price per barrel of crude oil since early 2005. During 2017, the average monthly price per barrel of oil rose nearly 20% to reach an average of $52 per barrel by December 2017 and continued rising in 2018 to reach nearly $70 per barrel in early April 2018. Reflecting rising prices, the volume of crude oil imports for 2017 was nearly flat for the year compared with volume changes in 2016. The rise in the average price of a barrel of crude oil combined with a slight increase in the amount, or the volume, of oil imports in 2017 compared with 2016 resulted in a nearly 30% increase in the overall value of imported crude oil and a slight increase in the share of the total U.S. merchandise trade deficit that is associated with the trade deficit in energy imports.
In general, market demand for oil remains highly resistant to changes in oil prices and reflects the unique nature of the demand for and the supply of energy-related imports. Turmoil in the Middle East is an important factor that continues to create uncertainty in global petroleum markets and was one of the most important factors in causing petroleum prices to rise sharply in early 2011 and in 2012. A slowdown in the rate of growth in the Chinese economy, combined with a rising in raw material prices, an increase in the rate of economic growth among commodity-exporting developing economies, and improved prospects of growth among many of the major developed economies, all have pushed up demand for energy products. Fluctuations in U.S. energy production, uncertainty concerning oil production decisions by various members of the Organization of the Petroleum Exporting Countries (OPEC), and the potential impact of new Iranian supplies of oil also have worked to push up the global market price of oil. Oil futures markets in April 2018 indicate that oil traders expect crude oil prices to trend in the range of $63 per barrel through 2018, below early April 2018 market prices. At current prices and volumes, energy imports in 2018 are projected to rise to about $200 billion, or about $25 billion more than in 2017. This report provides an estimate of the initial impact of the changing oil prices on the nation's merchandise trade balance.