The number of countries receiving exported US crude oil has risen since the removal of restrictions on exporting US crude oil in December 2015. US crude oil exports have occurred despite relatively small price spreads between international crude oils and domestic crude oils, as well as other factors that should reduce crude oil exports such as falling US crude oil production and added cargo export costs.
Based on the latest available data, US crude oil exports averaged 501 000 bpd in the first five months of 2016, 43 000 bpd (9%) more than the full year 2015 daily average. US exports of crude oil had already increased significantly before the lifting of crude oil export restrictions. These exports were mostly to Canada, which was excluded from the previous restrictions. From 2000 to 2013, US exports rarely surpassed 100 000 bpd. By 2015, the United States was exporting 422 000 bpd to Canada and a total of 26 000 bpd to five other countries.
In recent years, crude oil exports to destinations other than Canada were often re-exported volumes of foreign crude oil or cargoes of Alaskan crude oil, which were both exempt from export restrictions. The number and variety of destinations for US crude oil exports has increased since the lifting of restrictions. So far in 2016, US crude oil has been exported to 16 different nations, totalling 501 000 bpd.
US crude oil exports to countries other than Canada have surpassed exports to Canada in two months in 2016. In March, total crude oil exports to countries other than Canada reached 259 000 bpd, or 10 000 bpd more than crude oil exports to Canada. In May, total US crude oil exports to countries other than Canada reached 354 000 bpd, 46 000 bpd more than crude oil exports to Canada.
Other than Canada, the largest and most consistent US crude oil export destination for the first five months of 2016 has been Curacao, an island nation located in the Caribbean Sea north of Venezuela. US crude oil exports to Curacao averaged 54 000 bpd through May. Petróleos de Venezuela (PDVSA), the state-owned oil company of Venezuela, operates the 330 000 bpd Isla refinery on Curacao, as well as crude and petroleum product storage facilities on the island. Trade press reports indicate that US crude oil exports to Curacao are likely being used as diluent, where a light (less dense) US crude oil is blended with a heavy Venezuelan crude oil, for either processing at the Isla refinery or for re-export to PDVSA customers.
Continued increases in US crude oil exports will likely depend on increases in US crude oil production and significantly wider price differences between domestic and international crude oils, neither of which are projected in EIA's August Short-Term Energy Outlook.
Adapted from press release by Rosalie Starling
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