The export market for hydrocarbon shipments is currently experiencing a seismic shift, as crude oil and liquefied natural gas (LNG) begin to move overseas in volumes the industry has never seen.
U.S. exports of petroleum products have not seen major recent changes like exports of oil or gas, but are actually the majority of all American hydrocarbon shipments. Exports of refined products have been in progress for years, and began before the U.S. started exporting crude oil in significant volumes. Before the crude export ban was lifted, refined product exports were essentially the only way to send new American production overseas.
Source: EnerCom Analytics
Companies have extensively taken advantage of this opportunity, and products exports have been rising steadily since 2007. Total refined products exported have grown from an average of 1.4 MMBPD in 2007 to almost 5.8 MMBPD in December 2017. This is not the massive rapid percentage growth seen in oil or LNG, but has been roughly consistent for the past ten years.
Source: EnerCom Analytics
American exports of refined products are much more diversified than exports of gas or crude oil, and a total of 106 countries received American refined products in 2017. As with gas exports, Mexico consumes the largest share of U.S. products exports. The country consumes 20% of all exported American refined products, typically through pipelines from Texas. Canada receives another 10% of exports, while Asian nations account for 20% of all shipments.
Source: EnerCom Analytics
It’s true that the U.S. exports numerous refined products, distillate fuel oil, but gasoline and NGLs represent the majority of volumes sent overseas. Different markets exist for each product, as certain countries may demand large volumes of one product but have minimal need for another.
Latin America dominates U.S. gasoline exports:
- Mexico accounts for 56% of all shipments.
- Guatemala, Brazil and other Latin countries consume almost all the rest.
- Less than 8% of U.S. gasoline exports travel beyond Central and South America.
- Central and South America consumes 71% of distillate fuel oil exports.
NGLs shipments actually depart for abroad
NGLs, on the other hand, are much more diversified. Asian markets consume 43% of U.S. NGLs, which are used as petrochemical feedstocks. Canada, Mexico and European countries also consume large volumes of these natural gas products.
These product exports are likely to continue to grow, powered by the massive refining complex that is the U.S. Gulf Coast. Texas and Louisiana have been rightly described as “the refinery of the world,” and the area is extensively utilizing the opportunity to send products to new markets.
EnerCom recently conducted a thorough analysis of U.S. exports of oil, gas and petroleum products, in the most recent Monthly Trends Report.
