June 1, 2022

WWW.ENERGYINTEL.COM

US Sails More Refined Products to Europe

  • More US diesel sails to Europe to help offset lower imports from Russia
  • US product exports reached a record high in March, EIA data show
  • US liquids output grew sharply in March after a slow start of the year

US shipments of refined products to Europe hit near-record levels in March while gross product exports set a new one, government data show. The Energy Information Administration's (EIA) Petroleum Supply Monthly (PSM) pegs flows of fuels such as diesel and gasoline across the Atlantic at 798,000 barrels per day in March, up 58,000 b/d from February and 254,000 b/d higher than the same month 2019, the last year before the Covid-19 pandemic. Market players say US product exports to Europe are likely to climb higher.

Replacing Russia

The jump in trans-Atlantic shipments comes in the wake of Russia’s invasion of Ukraine and lower refined product exports from Russia into Europe, which sourced a quarter of its crude and more than 60% of its diesel from the country in 2021. European countries were searching and continue to search for replacement suppliers, and the US is emerging as a key source of petroleum. This trend is set to intensify as the EU implements a ban on seaborne oil from Russia, a move Energy Intelligence calculates would disrupt some 3 million b/d of crude and products.

Overall US product exports climbed to a new record of just under 6.2 million b/d in March. Shipments of distillate fuel oils such as diesel and heating oil climbed almost 200,000 b/d from February and some 400,000 b/d from last March, highlighting impacts of the war in Ukraine. Given Europe’s reliance on diesel for its transportation sector and lower Russian supplies, exports are likely to remain high — indeed, the overseas pull has been strong enough recently to divert barrels away from domestic US pipeline systems. This left the US Northeast precariously short product, especially in New York Harbor, where the Nymex diesel contract gets priced and delivered, causing diesel prices to spike as a result.

Crude exports continued to hover around the 3.3 million b/d mark, with roughly 1.3 million b/d going to Europe. Singapore, however, was the top singular destination at 360,000 b/d.

Finished Business

Overall imports of crude and product actually climbed slightly in March, hovering south of 8.5 million b/d. The bulk of imports — some 6.4 million b/d — consist of crude oil.

Canada and Mexico together accounted for 73.4% of total crude imports at a combined almost 4.7 million b/d, with Saudi Arabia, Colombia, and Iraq rounding out the top five foreign crude suppliers. EIA data show that the US continued to import some 575,000 b/d of Russian petroleum in March, of which 439,000 b/d comprised products such as unfinished oils used in the refining process. Indeed, Russia accounted for 66.5% of some 565,000 b/d in imports of unfinished oils to the US.

The EIA’s company-level data show several firms were active in importing oil from Russia in March, including Exxon Mobil, Chevron, BP, Delta Air Lines’ refining subsidiary Monroe, Valero, Shell and Marathon Petroleum. The US instituted a ban on imports of Russian petroleum in early March, and the PSM data reflect final cargoes coming into the country. Since March, refiners and traders have been turning increasingly toward Latin America for supplies of such oils.

Domestic Production

US supply of crude and other liquids bounced back sharply in March after lower-than expected volumes in January and February that had caused downward adjustments to US production for 2022. March was up nearly 700,000 b/d for all liquids on the month. US production was 18.9 million b/d versus 18.2 million b/d in February.

US crude output rose to 11.655 million b/d, up 343,000 b/d from February. The bulk of the increase — 280,000 b/d — was in Texas, EIA data show. Natural gas liquids jumped 396,000 b/d.

The US was again a net exporter of fuel in March with exports outstripping imports by 1.05 million b/d. The weekly estimates of US oil demand were in the ballpark this month after steep downward adjustments in previous months. US demand was seen at 20.5 million b/d in March.
US Crude Oil Imports, March 2022
CanadaMexicoSaudi ArabiaColombiaIraqRussiaEcuadorGrand Total
('000 b/d)Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21
Phillips 665275151301202332------912844812
BP581474------------628489
Marathon347306313340---59-22-22-590364
Chevron3133954913271111735442---57533456
Exxon Mobil386458------------427458
Flint Hills355329------------355329
Saudi Aramco74---247---------334-
Valero1124166142---117493----292344
PBF Energy113106345551531616--34593423281311
Houston Refining853070-12-6534-----1324476
Cenovus Energy237116------------237116
PDV Midwest Refining176161------------176161
Holly Refining and Marketing159100------------159100
Suncor120111------------120111
CHS10396------------10396
Top 153,3062,8605263995041561921331871355759661055,3214,224
Total Companies4,0413,8436574825043092271331871351361971091406,4165,787
Total Imports4,0413,8436574825043092271331871351361971091406,4165,787
US Petroleum Product Imports, March 2022
CanadaRussiaMexicoSouth KoreaNetherlandsBrazilIndiaGrand Total
('000 b/d)Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21
Valero665216717211-613-1----323275
Exxon Mobil91013611350--16114---10252251
Irving Oil208234------------208234
Shell10-15-----56-----125-
Phillips 6625323681238--31-3199490
PBF Energy--26164521--------9179
BP79-3--10-339-9--87125
Atlantic Trading1-102010-1010914-1-2576111
Chevron--7011214---15-15107134
Saudi Aramco--27---4---8-8-52-
Petrogas Energy3942------------3942
Vitol-166143----10-0-2432130
Global Companies--6-2----82-2-2727
PMI Trading----2632--------2632
Plains2536------------2536
Top 153694054343751658637476986561056781,5281,464
Total Companies5826694395431758612891811925719541122,0422,500
Total Imports5856694395431758612891811925719541122,0452,501
US Petroleum Product Imports, March 2022
CanadaRussiaMexicoSouth KoreaNetherlandsBrazilIndiaGrand Total
('000 b/d)Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21Mar '22Mar '21
Other Oils33123673376844126-6-2-1603510
Motor Gasoline14018941105--2134591110105462529925
Residual Fuel Oil1215283510740----571--260147
Middle Distillates128165461-21211974-1-48227501
LPG/Chemicals196221------------199223
Kerosene-Type Jet Fuel159--0-7342------12493
Asphalt4746------------4952
Lubricants1110-0--11821--0-4637
Petroleum Coke21-5-------4--512
Grand Total5826694395431758612891811925719541122,0422,500
Total Companies5826694395431288612891811925719541122,0422,500
Total Imports5856694395431758612891811925719541122,0452,501
US Petroleum Product Exports, March 2022
Total ProductsTotal ProductsLPG & Pents+LPG & Pents+MogasMogasJet KeroJet KeroDistillatesDistillatesResidsResidsPet CokePet CokeOtherOther
('000 b/d)Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21Mar'22Mar'21
All Destinations6,1954,9942,5292,208909798176651,22986711291557514684451
Mexico1,1621,094238173529486462921927881359666448
Canada4815292603123263361588732121412685
Japan447446429382000000001742122
China4124143062900000000010685138
Brazil3752705056221504169530051678376
Indonesia1581861581610000025000000
India2231661241240100000083281613
Korea174152141108000001670002628
Chile2291394530331517212981020059
Peru1351298184425906680000077
Netherlands241104103700030290001230944
Dominican Republic68813634614401318630635
Panama1597972331621280571600022
Guatemala1017513132922144735009011
Ecuador1767550343129007590070133
Colombia185702045398070700006024
Honduras11569232126131136230228702
Costa Rica5764641930632326000021
Spain48583790000800044901
Egypt785660470000000017910
France13551054000000002021
Morocco414936340000000051500
Singapore1004339330000200290001210
El Salvador45371181214411713000022
United Kingdom11736623500004200000140
Bahama Islands67311129110101226160000
Other788485275154181418416812513221479515070
US Crude Exports, March 2022
MonthlyMonthlyAvg.Avg.
('000 b/d)Mar'22Mar'2120192018
All Destinations3,3192,6852,9822,048
India672560255151
Netherlands378258279132
Korea344325419242
Canada336385479440
United Kingdom243220244167
China206705137231
Singapore17707843
Italy170120128108
Taiwan15947169131
Switzerland147024
Spain114234722
France96718823
Germany9069273
Thailand7110110938
Uruguay520155
Dominican Republic35161410
Australia240410
Norway24242435
Peru2423287
Denmark22233517
Ireland22394313
Brazil18284825
Colombia18181824
Nicaragua912116
Belgium1040
Lithuania04820
Other-133-42900

Frans Koster, New York