The U.S. Gulf Coast saw its crude oil imports in March at their lowest level since 1986, as rising domestic production and falling imports from OPEC including Venezuela have started to fundamentally change how the Gulf Coast is supplied with crude, the EIA said in an analysis this week.
In March 2019, the Gulf Coast’s crude oil imports averaged 1.8 million bpd, the EIA data showed. This was the lowest level of Gulf Coast imports since March 1986 and a drastic reduction from the peak of 6.6 million bpd of crude imports in March 2007.
Recent events and longer-term trends have been changing the crude oil supply of the Gulf Coast, leading to lower imports. These factors include this year’s U.S. sanctions on imports from Venezuela and higher than usual refinery maintenance in the early months of 2019. The Gulf Coast imports from OPEC have also been lower in recent months and years due to the cartel’s ongoing production cuts. In addition, rising oil production from Texas has significantly raised domestic light crude oil supply of the Gulf Coast, the EIA noted.
In the early months of the year, Gulf Coast imports are usually lower because of refinery maintenance, but this year planned maintenance was higher than usual. Then, the sanctions on Venezuela—which accounted for 20 percent of all Gulf Coast crude imports in 2018—restricted imports from the troubled Latin American oil producer. The Gulf Coast, which historically has been the destination of 98 percent of all U.S. crude imports from Venezuela, has seen its Venezuelan intake sharply cut this year. Related: The Gas Flaring Crisis In The U.S. Oil Patch
Between January and March 2019, Gulf Coast oil imports from Venezuela fell by 498,000 bpd to 47,000 bpd in March. As a result of the Gulf Coast reductions, U.S. four-week average imports from Venezuela fell from 603,000 bpd for the week ending January 25 to just 12,000 bpd for the week ending May 31, the EIA said.
On the other hand, in ten years, Gulf Coast crude oil production jumped from 2.7 million bpd in 2008 to 7.9 million bpd in March 2019, according to EIA data.
Due to all these factors, foreign-sourced crude oil accounted for an average 36 percent of Gulf Coast refinery crude oil inputs in 2018, compared with 73 percent in 2008.
Moreover, in the past five consecutive months, the U.S. Gulf Coast has exported more crude oil than it has imported, according to the EIA, which said in March 2019 that the region became a net exporter of crude oil in late 2018.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More