US coal exports fall further in July

Viewpoint: Global trade shifts to add pressure to MRs

Viewpoint: Global trade shifts to add pressure to MRs

London, 17 December (Argus) — Lower US and west African gasoline demand is likely to keep European Medium Range (MR) tanker rates drifting in 2026. The US has become more reliant on domestic gasoline production, as weaker European refinery output made oil products from the region more expensive and uncompetitive. Freight rates on average in 2025 on the UK Continent to US Atlantic coast route stood at $22.46/t, compared with $26.38/t in the same period in 2024, as US gasoline imports on MRs have plunged since mid-2025, slumping to just 90,000 b/d in November from 349,000 b/d in May. Trade on the UK Continent to west Africa MR route has also waned, although it rallied briefly in late 2025 as a result of a now-scrapped Nigerian import tariff on gasoline and diesel and a seasonal increase in demand. Rates averaged $30.84/t in 2025, down from $33.67/t in the same period a year earlier. Nigeria's independently-owned 650,000 b/d Dangote refinery cut its gasoline asking prices from 872 naira/l ($0.60/l) in early November to N828/l ($0.57/l) by 10 November. This will probably keep European imports uneconomical for Nigerian buyers. Dangote said it will supply 50mn litres/d (315,000 b/d) of gasoline in December and January to its domestic market, and 57mn l/d (359,100 b/d) from February, which could make imports from Europe largely redundant. For comparison, gasoline consumption in Nigeria was around 50.9mn l/d (320,670 b/d) in the 12 months to October. But sanctions on Russian oil firms Lukoil and Rosneft have weighed on diesel exports from India and Turkey, creating concerns about European supplies and turned participants' focus towards other exporters. This could provide support to the transatlantic rate, as participants will seek to replace Russian-related product with non-Russian, potentially importing more diesel from the US. US spat US president Donald Trump's build-up of military hardware in Caribbean waters could put 20pc of US Gulf coast refined product exports in shaky territory if tension between the US and Venezuela escalates into open conflict. Over the past 12 months, the Caribbean region — which includes buyers in Colombia, Dominican Republic, the US Virgin Islands, Jamaica and Saint Lucia as well as Central American countries such as Panama — has imported the majority of US Gulf coast refined products at an average of 643,300 b/d, Vortexa data show. These shipments were primarily diesel and gasoline, alongside smaller amounts of naphtha. Venezuela's naphtha imports from the US Gulf in May 2025, when the last of US sanction waivers expired, were 87,500 b/d, according to Vortexa. The product is used to dilute the country's extra-heavy crude. Only 15,000 b/d of naphtha flowed back to Venezuela when Chevron received a new waiver in August. Venezuelan buyers have turned to Russian supply from the Mediterranean carried on larger tankers, removing tonne-mile demand overall from the MR segment while lowering the amount of physical activity within the US Gulf coast spot market. Escalating conflict between the US and Venezuela could add war-risk premium insurance costs to Caribbean islands and Colombian trade, making Russian suppliers more competitive and potentially rerouting some of the 420,900 b/d the US Gulf coast exports to other destinations. This could make suppliers like Russia more competitive for this traditionally US Gulf coast-supplied region. If shipowners avoid the Caribbean region because of a conflict, this could increase competition for west coast South America-bound voyages and could boost Panama Canal transit if demand from Chile and Peru increases. This would raise the average auction cost for the Panamax locks for MRs, which typically carry refined products from the US Gulf coast. By Erika Tsirikou and Ross Griffith Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.