A cargo of U.S. condensate has reached Abu Dhabi in the latest sign how much the oil market has changed in the last few years. The 700,000-barrel cargo, Bloomberg reports, was bought in December from US-based Enterprise Product Partners. This is the first U.S. cargo to be shipped to the Middle East.
Although the news is significant inasmuch as it indicates the United States’ strengthening position on international oil markets, it is unlikely that U.S. condensate imports into the UAE will become a regular thing, according to at least one analyst.
The head of Lipow Oil Associates, Andy Lipow, told Bloomberg that “As a member of OPEC and a large crude producer, I would imagine they would be very self-sufficient in their own crude supply.”
Yet, its condensate supply came mostly from Qatar before the Saudi-led blockade, in which the UAE also took an active part as a firm supporter of the Kingdom.
The UAE produced around 2.87 million bpd of crude oil in January, in line with its production quota under the OPEC supply cut deal. At the end of the month, the Energy Minister announced the state oil company ADNOC will further reduce production to comply with the deal. Related: BP Has Its Most Successful Year This Decade
Meanwhile, U.S. production is growing, and the latest Short-Term Energy Outlook by the Energy Information Administration projects the daily average to reach 11 million bpd earlier than previously expected. The EIA said this year the U.S. will produce an average of 10.6 million bpd, rising to 11.2 million bpd next year.
US oil exports are on the rise as well. Last month, the EIA reports, these averaged 1.4 million bpd, versus half this amount a year earlier. This increase was one of the factors that supported oil prices in late 2017 as it led to drawdowns in U.S. oil inventories – a closely watched gauge of supply and demand.
By Irina Slav for Oilprice.com
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