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Asia Snapping Up U.S. Crude Oil In Near Record Amounts

Asia has scheduled near-record volumes of U.S. crude oil to be shipped next month, according to trade sources who spoke to Reuters.

Between 1.5 million and 1.9 million bpd of U.S. crude—most of which is WTI Midland—will make their way to Asia in August, just shy of the 2.2 million bpd record loadings of Asia-bound crude oil that the U.S. saw in April.

WTI continues to be an attractive grade for Asia’s refiners, who see it as a bargain compared to the Middle East benchmark Dubai. The spread between the two grades stood at $5.40 per barrel as of Thursday. That’s down from $6.08 per barrel in June, but higher than the $3.93 Asian refiners saved in May.

The influx of U.S. crude oil to Asia also follows two increases in Saudi Arabia’s crude oil official selling prices (OSP).

“China requested less term supply from Saudi in recent months and is seizing crude from everywhere to fill in the supply gap,” a Singapore-based trader told Reuters. Consultancy Energy Aspects expects that the influx of U.S. crude oil into Asia will increase in the third quarter as well.

“We forecast U.S. exports to Asia will increase quarter-on-quarter in Q3 23, with China and even Japan purchasing Midland cargoes in size,” Energy Aspects told Reuters.

U.S. crude oil inventories fell by around 700,000 barrels last week, partly on higher crude oil exports.

The news of Asia’s increase in U.S. crude oil purchases comes just a day after the U.S. Senate easily passed an amendment to the annual defense bill that would ban crude oil exports to China from the Strategic Petroleum Reserve (SPR). The amendment garnered widespread bipartisan support.

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By Julianne Geiger for Oilprice.com

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  • George Doolittle on July 22 2023 said:
    Why the USA exports any oil that is so clear an enemy to the United States and openly so just proves out how inherently and worthlessly corrupt now to the point of treason given *THEIR* War the Bidens are waging against Russia.

    All of that oil if any be allowed to export and this should go back to when this not be true during the Cold War when that was the Law such that the USA could win Wars well, nobody cares about how many USA Americans die period who are charged doing the exact opposite of that #war_mongers and #government_war_monger_departments all driving and flying their mega gas guzzlers hither and yon as if Washington DC produces any energy product which of course #never_have #never_will
  • Mamdouh Salameh on July 21 2023 said:
    US exports of 1.5-1.9 million barrels a day (mbd) to Asia in August amount to less than the average daily imports of Russian crude by China and India by 17%-35% and 16%-34% respectively.

    Moreover, whatever the United States says it exports isn’t real exports. It is merely an exchange between its ultra-light crude it exports and medium and heavy crudes it imports for its refineries which are tooled to process heavy crudes.

    The United States consumed on average 20.28 mbd in 2022 and produced an estimated 11.0 mbd thus necessitating imports of 9.28 mbd. (Don’t believe the US Energy Information Administration’s (EIA) hyped figure of production of 12.4 mbd.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

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