By US oil exports may decline in 2025 for the first time since the COVID-19 pandemic due to China’s retaliatory tariffs on the United States, Reuters reported on Thursday.
This comes after US oil export growth plateaued last year.
The report stated that US crude exports have increased by over 10 times since the 40-year federal ban on domestic oil exports was lifted in 2015.
The US has become the world’s third-largest oil exporter, following Saudi Arabia and Russia.
This is due to increased exports, which have lessened the global effects of production cuts by the Organization of the Petroleum Exporting Countries and allies.
OPEC and its allies have been cutting oil production by a massive amount since the past couple of years. The cartel is currently adhering to 5.85 million barrels per day of production cuts, which is nearly 6% of global supply.
US exports to China
Ship-tracking data from Kpler showed that in 2024, the US exported 166,000 barrels of crude oil per day to China, according to the Reuters report.
This accounted for almost 5% of all US crude exports, despite China’s decreased demand for American oil in recent years due to discounted barrels from Russia and Iran.
Kpler reports that US crude exports saw minimal growth in 2024, increasing by only 0.6%, or 24,000 barrels per day, to an average of 3.8 million bpd, Reuters reported.
This stagnation is attributed to US companies limiting shale production due to concerns about global demand.
Matt Smith, an analyst at Kpler, told Reuters that China’s share of US exports is substantial, and that international demand for American crude exports may have reached its peak.
He added that China’s retaliatory tariffs could further accelerate the decline in demand.
Crude grades
US refineries are well-equipped to process medium-sour crude grades, such as Mars and Southern Green Canyon.
These medium density, high sulfur content crude types account for approximately 48% of the US crude imported by China, according to the report.
Analysts suggest that this type of crude could easily find domestic buyers, especially if the US imposes tariffs on Canada and Mexico.
Rohit Rathod, market analyst at energy researcher Vortexa was quoted in the report:
Medium sours are welcome barrels in the US Gulf Coast. Refiners need it.
US exports could potentially drop to 3.6 million barrels per day this year, according to Rathod.
This is especially likely if the tariffs on Canadian and Mexican crude are implemented and medium-sour crude is maintained.
Analysts said that light, sweet grades of oil, such as West Texas Intermediate crude produced in Texas, could still be exported and may find demand from European and Indian refiners at competitive prices.
These types of lighter density, lower-sulfur crude oil accounted for around 44% of China’s crude imports from the US.
Minimal impact on China
Kpler reported that nearly half of all US crude oil exports to China were handled by the Louisiana Offshore Oil Port (LOOP) last year.
Further Kpler data showed that Enbridge’s Ingleside, Texas, facility near Corpus Christi, was responsible for 25% of US exports to China, Reuters said.
Occidental Petroleum is one of the biggest sellers of US crude oil to China. In 2024, it sold at least 13 cargoes of light, sweet WTI Midland oil to China, according to Kpler.
The effect on China is probably minimal, as US imports only made up 1.7% of the country’s total crude imports in 2024, which was roughly $6 billion, according to Chinese customs data. This is a decrease from 2.5% in 2023.
Meanwhile, China increased imports from Canada by approximately 30% last year, exceeding 500,000 barrels per day due to the Trans Mountain pipeline expansion.
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