Oil export occurs when a country sells oil from its reserves to acquire revenue and stabilize its economy. On the other hand, oil import is needed when a nation cannot cover its domestic energy requirements from local production and thus imports oil from foreign nations.

Who are the Biggest Oil Producers and Consumers?

In 2023, the U.S., Saudi Arabia, and Russia were the biggest producers of oil and accounted for almost half of the world's production. Canada, China, Iraq, Brazil, the UAE, Iran, and Kuwait also produced significant amounts, together producing 73% of world oil. But it is only half the story, as consumption is equally important. The U.S. and China were by a long shot the largest consumers in 2022, contributing to more than 35% of global oil demand. India, Russia, Saudi Arabia, Japan, Brazil, South Korea, Canada, and Germany came after them, accounting for more than 60% of global demand. Countries with the biggest industrial and transportation infrastructures have the highest oil consumption, as these are the energy requirements and the economic clout needed to support them. As long as the oil remains the king of the energy realm, the authority belongs to whoever produces and consumes it.

Geopolitical Influence and Economy

The export of oil can tremendously increase the geopolitical influence of a nation because oil is a strategic resource that will forever remain an effective instrument of international diplomacy. Russia and Saudi Arabia, for example, have in the past utilized their oil exports to gain political and economic mileage in the world. For example, Russia's 2022 push into China's oil market allowed for sanctions and OPEC+ production limits to be bypassed and additional financing procured for projects like the war in Ukraine. Yet excessive reliance on oil exports can also create economic vulnerabilities and subject countries to external shocks and political instability. Volatility in international petroleum prices, fueled by geopolitical tensions, supply-demand ratios, and environmental policies, can create daunting challenges for oil-supplier countries. It can also impact the political stability of a country and even its foreign policy decisions. Besides that, geopolitical tensions can directly disrupt oil supply chains with direct and instant economic impacts. The Gulf Wars between Iraq and the 42-nation coalition of the US (1990-1991 and 2003), for example, inflicted damage on oil facilities and pollution of the Persian Gulf, which had a major impact on world oil exports. Geopolitical tensions not only disrupt the physical supply of oil but also market perceptions, hence leading to price volatility and altered trade patterns. Various wars around the world are often led over oil, as it represents one of the most important strategic resources. The strongest incentive for war is often a nation's position as a net importer of oil. Politics over oil is contentious as resource wars, importers' dilemmas, and exporters' dilemmas. Net oil imports are enormous, with exporters vulnerable to hostility and the "resource curse," and importers bogged down in complex conflicts with energy needs. Understanding these mechanisms makes it simpler to analyze global security trends.

The Biggest Oil Buyers

China was the largest oil importer in 2023, with 11.3 million barrels per day of crude oil imports, which is 10% more compared to 2022. It is due to higher refining capacity to meet transport fuel and petrochemical production. Russia, Saudi Arabia, and Iraq are the largest suppliers with Russia becoming the largest at 19% of Chinese imports due to discounts due to sanctions. China also increased imports from the U.S., Brazil, and Iran, while imports from other countries like Norway and the U.K. fell with the rise in Western European oil prices.While oil export has the potential to provide nations with immense geopolitical power and economic benefit, it also presents different forms of threats. Highly oil-reliant nations must balance the opportunities of oil exportation with the potential economic and geopolitical risk. Economies may be diversified, as well as strategic policies developed, so that the adverse effects of oil exportation reliance are minimized.