Analysis: EIA Sees Petroleum Export Record on Hormuz Stall


   
Karim Bastati
DTN Analyst

   Analysis: EIA Sees Petroleum Export Record on Hormuz Stall

   VIENNA (DTN) -- Refined product exports from the United States soared to a 
record high last week as refiners and consumers worldwide scrambled to replace 
lost Middle Eastern supply, U.S. Energy Information Administration data showed 
Wednesday (4/22).

   At 8.08 million bpd, product exports were at their highest in history, 
surpassing the previous record weekly pace set in late March by 174,000 bpd. 
Over the past four weeks, such exports averaged 7.77 million bpd -- more than a 
million bpd, or 15.6%, above the average pace in the same period of last year.

   The surge came on the back of soaring international demand for U.S. diesel, 
which has been on a steady rise since the U.S.-Israeli war on Iran led to a 
fifth of global petroleum liquid supply being cut off the market. The closure 
of the Strait of Hormuz not only affected some 5 million bpd of refined product 
flows mostly in the form of middle distillates, but also at least 12 million 
bpd of crude oil supply of Asian refiners, leading to cut runs and fuel export 
bans which further tightened the diesel market.

   The Persian Gulf became a vital source of diesel imports for Europe since 
the EU embargo on Russian product imports in February 2023. East and Southeast 
Asia, meanwhile, relied on fuel produced from Middle Eastern crude and regional 
trade. The ongoing supply disruption and its ripple effects downstream opened 
wide arbitrage windows for refined product flows from the U.S. East and Gulf 
Coasts to Europe and Asia.

   Total distillate exports from the U.S. have since mid-March rocketed from 
1.05 million bpd to a five-month high 1.6 million bpd. Over the past four 
weeks, they clocked in at more than 1.54 million bpd, up 31.5% year-on-year and 
the fastest since August 2024 when they last breached the 1.5 million bpd mark. 
EIA data showed that exports have over the past month been above year-ago 
levels in every fuel category from gasoline (up 11% year-on-year) to so-called 
"other oils" (up 13.5%).

   Combined with increased demand for U.S. crude oil, total petroleum exports 
last week posted a record high 12.88 million bpd, dwarfing the previously 
fastest weekly pace prior to current events by more than 1.5 million bpd. They 
have rocketed by close to 2 million bpd since mid-March and have averaged 12.19 
million bpd in the last four weeks, up 14.4% year-on-year.

   With the Strait of Hormuz now being subject to a double blockade by both the 
U.S. and Iran and future peace talks in limbo, an imminent resumption of flows 
from the Middle East remains unlikely. U.S. exports are in prime position to 
continue at this record-breaking pace, limited only by logistical constraints 
which are being tested in an unprecedented fashion.




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