US crude exports fell by 16pc in May, with India the top buyer followed closely by China.
Total domestic crude exports averaged 2.71mn b/d in May, down from 3.24mn b/d in April, according to trade data released today by the US Census Bureau. US crude exports in May were down from 2.93mn b/d a year earlier.
India was the top destination for US crude in May, taking about 360,000 b/d, down by about 10,000 b/d from the prior month. State-controlled Indian refiners in December expanded their import portfolio to include more US grades. IOC is now including West Texas Light (WTL) as an eligible grade in its weekly import tenders and Hindustan Petroleum (HPCL) issued a unique tender that sought Mars for its Vizag refinery earlier this year.
Meanwhile, India has struggled with a devastating outbreak of Covid-19, but the outlook is improving as the number of new infections eases. The country’s diesel and gasoline consumption rebounded in the first half of June by 12pc and 13pc, respectively, compared with the same period in the prior month.
US crude headed to China averaged about 350,000 b/d in May, up from 202,000 b/d in April.
China’s intake of US crude was volatile last year, but exports to that country rose sharply in May-December 2020, averaging 690,000 b/d during that time, buoyed by an interim trade agreement signed last year with the administration of former president Donald Trump. The deal required China to buy $27bn of US crude and other energy commodities in 2020 and $42bn in 2021. Chinese purchases of US crude last year more than tripled from 2019, but they remained well below the dollar targets set in the phase one deal.
Under the new administration of President Joe Biden, a major change in energy policy priorities has diminished the value in Washington of the US-China phase one deal. The deal remains, but much US-China trade remains subject to punitive tariffs.
Overall US oil exports in 2020 rose to a yearly record of 3.2mn b/d, even as the Covid-19 prompted global demand to plummet and as a string of tropical storms and hurricanes disrupted shipping in the Gulf of Mexico.
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.
The Census trade data has differed slightly from monthly Energy Information Administration (EIA) trade data this year because the EIA includes crude exports to the US Virgin Islands.