Asia Snapping Up U.S. Crude Oil In Near Record Amounts
07.24.2023 By - NEWS

July 24, 2023 [] – 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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