Houston is attracting crude flows via pipelines again as record-high U.S. oil exports have resulted in a surge in pipeline utilization to the top-exporting hub of Corpus Christi, analysts told Reuters.
Crude oil production in the top shale field in Texas, the Permian, is set to hit a record high of 5.694 million barrels per day (bpd) in May, up from an estimated 5.681 million bpd in April, according to drilling productivity data from the U.S. Energy Information Administration (EIA).
Since 2020, when Corpus Christi overtook Houston as the main export outlet for U.S. crude, pipelines to Corpus Christi have seen an increase in flows.
Now it is Houston’s turn to see higher crude flows, as the capacity on the pipelines to Corpus Christi is more than 90%, analysts have told Reuters.
The crude from the higher production from the Permian and the higher U.S. crude oil exports is now moving to Houston.
“Houston becomes the next logical market for those barrels,” Aaron Milford, CEO of Magellan Midstream Partners, told Reuters, commenting on the additional light sweet barrels from the Permian.
Meanwhile, U.S. crude oil exports hit a record in March, analysts at RBN Energy said this week in an analysis of the latest data from the U.S. Census Bureau.
U.S. crude oil exports exceeded 146 million barrels, or 4.7 million bpd, in March. This was the highest monthly export level since the ban on crude oil exports was lifted in December 2015.
Demand for U.S. crude in Europe and China has jumped in recent months due to the Chinese reopening and the EU and G7 sanctions on imports of Russian oil.
So in March, the U.S. shipped record volumes of crude to Asia Pacific and Europe, at 65 million barrels and 64 million barrels, respectively. China imported the highest volume of U.S. crude since May 2020, while the Netherlands imported the second-highest volume from the U.S in March, which was also a record in U.S. crude shipments to the Netherlands, RBN Energy said.
By Tsvetana Paraskova for Oilprice.com
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