On New Year’s Eve the tanker “Theo T” left the Texas port of Corpus Christi bound for Europe, laden with the first shipment of oil since President Obama lifted a 40 year old crude export ban.
“Our ability now to compete in those global markets is a game-changer. So the world as we’ve known it over the last 30 to 40 years is evolving, it’s re-aligning. And while we’ll have ups and downs, all we ask for is an opportunity.”Jack Gerard, President, American Petroleum Industry
A key target market now is much closer to home, Latin America and the Caribbean. Venezuela, for example, has the world’s largest proven reserves, but much of its oil is heavy “sour” crude, difficult to refine into gasoline.
Last month a shipment of US light “sweet” crude was pumped into a Venezuelan storage and refinery facility located on the Caribbean island of Curacao, for blending.
“South America is going to be a natural destination for a lot of those because the market there, Latin American countries are looking to buy more light sweet crude because they’re looking to blend it with their own heavy sour crude production and they are already competing, they are buying crude, sourcing crude from West Africa, Nigeria, similar in quality to what we are exporting out of the US. So I think there’s a natural competition there for, or an appetite for US barrels in Latin America.” Matt Cook Associate Editorial Director, Platts
The energy information service Platts says several American companies also competed against Nigeria to win a contract to supply a million barrels of crude to Uruguay.
“We heard from market sources that they received soliciations from US sellers into that tender. It was ultimately awarded to Nigerians though, to Nigerian crude. So I think we’re going to see a lot more of that going forward where they’re competing with each other head-on.”Matt Cook Associate Editorial Director, Platts
The world’s largest producer and consumer of oil is also the world’s largest importer of crude oil, so when prices are right, American refiners will still buy from Nigeria and Angola.US port infrastructure has also not been developed enough to dramatically increase export capacity straight away.
But oil industry experts now agree that the lifting of this export ban, signed into law by President Obama late last year, has now permanently change global oil trade dynamics.
