Monday, November 18, 2019
(November 18, 2019) — In the first half of 2019, the U.S. exported 5.47 MMbbld of petroleum products, an increase of 19,000 bbld, or 0.3%, from the first half of 2018 and the slowest year-over-year growth rate for any half year in 13 years, reports the Energy Information Administration (EIA).
Lower U.S. refinery runs in the first half of this year compared with the first half of last year, and slowing global economic growth that is limiting demand for petroleum products, likely contributed to fewer exports. In the first half of 2019, increased exports of propane and distillate offset decreased exports of all other petroleum products.
Distillate remained the top petroleum product export by volume in the first half of this year, averaging 1.3 MMbbld, an increase of 60,000 bbld, or 5%, compared to last year’s first half. Distillate has many uses, including in the transportation, manufacturing, agriculture, residential, and commercial sectors. Mexico is the top destination for U.S. distillate exports, receiving 290,000 bbld, or 22%, of total exports. Aside from Mexico, U.S. distillate exports go mainly to Central America and South America, including Brazil at 13%; Chile, 7%; and Peru, 5%. Exports also go to Europe, mostly to the Netherlands at 4%. The nation is also a transshipment country for some U.S.-sourced distillate volumes.
Propane was the second-largest U.S. petroleum product export in the first half of 2019, resulting in significant changes in both the destinations for U.S. exports and the amount of propane going to each destination as prices and markets adjusted. Even though Japan, Mexico, and South Korea remained the top three destinations, the volume going to Japan nearly doubled, from 188,000 bbld in the first half of 2018 to 334,000 bbld in the first half of 2019, an increase of 146,000 bbld, or 78%. Meanwhile,
U.S. propane exports to China fell from 74,000 bbld to 4000 bbld during the first half of this year.
Unlike the significant differences in U.S. propane exports between the first half of 2018 and the first half of 2019, U.S. motor gasoline exports were mostly stable. The U.S. exported 901,000 bbld in the first half of this year and more than 50% went to Mexico. Other U.S. motor gasoline exports go mostly to Central America and South America. Exports to Brazil increased 26,000 bbld, or 71%, when comparing the first halves of 2018 and 2019. Further, after sanctions were slapped on Venezuela in early 2019, U.S. exports of gasoline to that country fell from 30,000 bbld in the first half of 2018 to 8000 bbld in the first half of 2019, a 73% drop.
Residual fueloil exports declined the most when comparing the first half of 2019 and the first half of the previous year. They fell 74,000 bbld to average 258,000 bbld. In the 2018 first half, Singapore was the top destination for U.S. residual fuel exports, mostly to supply Singapore’s marine bunkering market. However, in the first half of 2019, trade press sources indicated that the city-state’s bunker market was preparing for new international regulations that limit the sulfur content of marine fuels by drawing down higher-sulfur residual inventories to make room for stocks that are lower in sulfur. As a result, U.S. exports of residual fueloil to Singapore dropped 68,000 bbld, or 80%, in the first half of 2019 compared to the first half of 2018.
Continued growth in petroleum product exports, albeit slower than in previous years, combined with increasing U.S. crude oil exports, will result in the U.S. becoming a total petroleum net exporter, EIA observes. EIA’s October 2019 Short-Term Energy Outlook forecasts this change will occur in the fourth quarter of this year.
Lower U.S. refinery runs in the first half of this year compared with the first half of last year, and slowing global economic growth that is limiting demand for petroleum products, likely contributed to fewer exports. In the first half of 2019, increased exports of propane and distillate offset decreased exports of all other petroleum products.
Distillate remained the top petroleum product export by volume in the first half of this year, averaging 1.3 MMbbld, an increase of 60,000 bbld, or 5%, compared to last year’s first half. Distillate has many uses, including in the transportation, manufacturing, agriculture, residential, and commercial sectors. Mexico is the top destination for U.S. distillate exports, receiving 290,000 bbld, or 22%, of total exports. Aside from Mexico, U.S. distillate exports go mainly to Central America and South America, including Brazil at 13%; Chile, 7%; and Peru, 5%. Exports also go to Europe, mostly to the Netherlands at 4%. The nation is also a transshipment country for some U.S.-sourced distillate volumes.
Propane was the second-largest U.S. petroleum product export in the first half of 2019, resulting in significant changes in both the destinations for U.S. exports and the amount of propane going to each destination as prices and markets adjusted. Even though Japan, Mexico, and South Korea remained the top three destinations, the volume going to Japan nearly doubled, from 188,000 bbld in the first half of 2018 to 334,000 bbld in the first half of 2019, an increase of 146,000 bbld, or 78%. Meanwhile,
U.S. propane exports to China fell from 74,000 bbld to 4000 bbld during the first half of this year.
Unlike the significant differences in U.S. propane exports between the first half of 2018 and the first half of 2019, U.S. motor gasoline exports were mostly stable. The U.S. exported 901,000 bbld in the first half of this year and more than 50% went to Mexico. Other U.S. motor gasoline exports go mostly to Central America and South America. Exports to Brazil increased 26,000 bbld, or 71%, when comparing the first halves of 2018 and 2019. Further, after sanctions were slapped on Venezuela in early 2019, U.S. exports of gasoline to that country fell from 30,000 bbld in the first half of 2018 to 8000 bbld in the first half of 2019, a 73% drop.
Residual fueloil exports declined the most when comparing the first half of 2019 and the first half of the previous year. They fell 74,000 bbld to average 258,000 bbld. In the 2018 first half, Singapore was the top destination for U.S. residual fuel exports, mostly to supply Singapore’s marine bunkering market. However, in the first half of 2019, trade press sources indicated that the city-state’s bunker market was preparing for new international regulations that limit the sulfur content of marine fuels by drawing down higher-sulfur residual inventories to make room for stocks that are lower in sulfur. As a result, U.S. exports of residual fueloil to Singapore dropped 68,000 bbld, or 80%, in the first half of 2019 compared to the first half of 2018.
Continued growth in petroleum product exports, albeit slower than in previous years, combined with increasing U.S. crude oil exports, will result in the U.S. becoming a total petroleum net exporter, EIA observes. EIA’s October 2019 Short-Term Energy Outlook forecasts this change will occur in the fourth quarter of this year.
