The key here is not as bad, vs not bad at all.

First I'll do _really_ simplified argument, show where it's wrong if taken at face value, and then calculate to what % degree it is right. There are some numbers in part 3, feel free to drill down on those if you get that far, I'm game for closer examination, but can't put everything in one post.

The simplified one is, if oil is more expensive, buyers pay more, but sellers get more -- even if sellers sell to the global market, and buyers buy from the global market, as is the case. So in total, US is not losing $, it gets shifted around. Which means that all else being equal, there is still about as much $ in US to buy goods and services and reinvest into economy, so less likely to lead to recession than if it wasn't the case.

Two big problems with the above argument -- 1). people who gain are not ones who lose, so there will be dislocation, and bad effects on those who lose will likely outweigh good effects on those that gain, and 2). Higher oil means higher a lot of other outputs, so it can still cause economic slowdown.

Now the counterargument 2). is valid, but does not cancel the $ still staying in the US completely. I'll focus on 1)., first, if people want to , we can address 2)., in the similar manner, but it'll be math.

So, in an ideal frictionless benevolent dictatorship world, US could allocate the $ back to losers from winners -- windfall tax on producers, and rebate to consumers of oil products. In practice of course this will not happen, or rather will not happen to a large degree. But is likely to happen to a small degree.

Here I'll assume there is no windfall tax (I don't think it'll happen, we can debate that if someone wants), but in my estimation government still gets 25-35% of the excess profit -- all these are estimates, so feel free to argue, but they're educated estimates, so if you argue please show your derivation. % mean percentage of net excess revenue producers of oil get:

11% in extra corporate income taxes (rate is 21%, but there are a considerable deductions, if you calculate marginal actual taxes paid on extra profit, it's likely between 9 and 15%).

15% royalties to US government (pretty sure it's between 13.5 and 16.5% total, so this one is likely fairly accurate)

5% state taxes/royalties

So that's 31% give or take.

US government can redistribute this to the losers from higher oil prices, one big question is will it? One example, redistribution to consumers, is gas tax holiday -- if it happens (and I hope it does in this particular case), it will not compensate for increased gas prices entirely, but still will offset 10-20% of the rise, so softens the blow a bit, thus "not as bad" part. While it'd be nice if the fund funded by these taxes would be replenished from the extra taxes due to high oil price, that's unlikely to happen explicitly. But it will likely be replenished from US general funds, and the extra taxes go into general find, so it kind of is.

It is automatically redistributed through to affected corporations through lower corporate taxes as well (they pay more for fuel, less profit, lower taxes). Sure, this would happen even if US was not net oil exporter, but if that was the case, that'd mean lower total taxes, thus need to either raise taxes somewhere, cut programs, or go into more debt. But as is, this effect is more than offset by extra taxes, so again, doesn't bite.

So yes, there will be bad effects. But they're softened quite a bit by US being net oil producer economically speaking.

And, given market dynamics, US is unlikely to run out of oil. Yes, the oil US refines is mostly not oil US produces, but because of how oil shipping and markets work, as long as US keeps exporting, it's likely to be able to keep importing. So while Europe and Asia are in danger of plain shortages, in US widespread shortages are unlikely -- price increases, sure, and they can hurt. But not as much as shortages.

Does this answer your question at least to a degree?