US crude exports fall, China top buyer

US crude exports fell below 3mn b/d in May with China as the top buyer.

Total domestic crude exports averaged 2.93mn b/d in May, down from 3.08mn b/d in April according to trade data released today by the US Census Bureau. It marked the third straight month of declines as efforts to combat the Covid-19 pandemic slashed global demand.

May exports were little changed from a year earlier.

US exports to China in May hit a record 1.26mn b/d, up from 114,000 b/d in April, 108,000 b/d in March and zero in January and February.

Exports to China were expected to start ramping up at the start of this year after Beijing and Washington signed an interim trade deal that included commitments to purchase US energy products. But the timeline was delayed by the coronavirus outbreak which caused many refiners in Shandong province to slash run rates because of travel restrictions. Fuel demand now is recovering in China.

Canada was the second top destination for US crude in May at 310,000 b/d, and South Korea was third with about 229,000 b/d.

US crude exports had been on an upswing late last year and into 2020 after new pipelines went into service moving Permian crude to the Gulf coast. But the market has been upended as some traders struggled to place cargoes in a saturated global market.

The Energy Information Administration separately estimates weekly US crude exports. Domestic crude exports averaged 3.1mn b/d in the week ended 26 June, the agency said yesterday.

Since the US lifted 40-year-old restrictions on most oil exports in December 2015, US crude — primarily light crude — has been exported to countries around the globe.

For the full year of 2019, US crude exports averaged 2.98mn b/d, an annual record.

The monthly trade data comprises several categories of oil, including crude under 25°API, crude that is 25°API or higher, and condensate derived wholly from natural gas.

By Eunice Bridges