The oil tanker Theo T departs the port of Corpus Christi with the first export cargo of US crude oil after the United States government repealed a 40-year ban on the export of crude oil in December 2015. Picture taken December 31, 2015. Photo credit: Port of Corpus Christi
By Sheela Tobben (Bloomberg) American oil exports from Louisiana’s offshore supertanker port jumped to a record in January as Asian buyers are stocking up U.S. crude for a post-pandemic rebound in fuel consumption.
Eight vessels set sale from the Louisiana Offshore Oil Port, the nation’s only facility that can fully load supertankers, carrying nearly 15 million barrels of crude to South Korea, China and India, according to ship-tracking data compiled by Bloomberg. That’s double the previous month’s volume and an all-time high for LOOP, as the terminal is known.
Asian refiner demand has provided major support to U.S. oil as the market rebounds from its worst-ever crash last year. Asia has recovered faster from the pandemic than the rest of the world, helping revive demand for crude and boost U.S. benchmark prices 13% so far this year.
Total U.S. Gulf crude outflows to Asia rose to nearly 51 million barrels in January.
Four South Korean processors including Hyundai Oilbank Co. and SK Innovation Co. purchased about 8 million barrels of North American crude including West Texas Intermediate and West Texas Light grades as well as Mars Blend for March arrival. It typically takes about 60 days for the U.S. cargoes to reach the Northeast Asian nation.
Asian refiners also face uncertainty in the return of some production from OPEC and its allies. LOOP receives the bulk of the high-sulfur crudes produced in the Gulf of Mexico, including Mars Blend, a regional sour benchmark that can replace oil produced in the Middle East.
“It is likely most of the exports from LOOP were Mars Blend,” said Emmanuel Belostrino, a Kpler crude market analyst.
In November, Mars Blend crude output was estimated at over half-a-million barrels a day, according to Louisiana state data.
Texas Oil Hub Gears Up for More Exports to China Despite Virus
Most of the tankers that set sail from LOOP in January were very large crude carriers, or VLCCs, each capable of carrying as much as 2 million barrels of oil.
LOOP is a joint venture of Marathon Pipe Line LLC, Valero Terminalling and Distribution Co. and a unit of Royal Dutch Shell Plc, which is a major producer in the Gulf of Mexico.
Related Book: Oil on the Brain: Petroleum’s Long, Strange Trip to Your Tank by Lisa Margonelli
— By Sheela Tobben with assistance by Sharon Cho, copyright ©2021 Bloomberg
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