Oil World Turns Upside Down as U.S. Sells Oil in Middle East

The United Arab Emirates, a style Persian Gulf petro-state where endless billions via crude exports feed a giant sovereign wealth fund, isn’t the most obvious customer for Texan oil.

Yet, in a trade in which illustrates how the rise of the American shale industry is usually upending energy markets across the globe, the U.A.E. bought oil directly via the U.S. in December, according to data via the federal government. A tanker sailed via Houston as well as arrived within the Persian Gulf last month.

The cargo of American condensate, a type of very light crude oil, was preferred to regional grades because its superior quality made more suitable for the U.A.E’s processing plants, a person with knowledge of the matter said, asking not to be identified discussing a commercially sensitive matter.

“As a member of OPEC as well as a large crude producer, I would likely imagine they would likely be very self-sufficient in their own crude supply,” said Andy Lipow, president of Lipow Oil Associates LLC. The purchases of U.S. oil aren’t likely to continue, given the U.A.E.’s own supply, Lipow said.

The end of a ban on U.S. exports in 2015 coupled with the explosive growth of shale production, has changed the flow of petroleum around the globe. Shipments via U.S. ports have increased via a little more than 100,000 barrels a day in 2013 to 1.53 million in November, traveling as far as China as well as the U.K.

U.S. Exports

The U.S. exported about 700,000 barrels of light domestic crude in December to the U.A.E., the Census Bureau reported Tuesday. While Energy Information Administration data show This particular’s the fourth-largest OPEC producer’s first cargo of U.S. oil, Adnoc said in July This particular purchased condensate via the U.S. for September delivery. Although This particular exports more than two million barrels a day, the Middle Eastern country typically imports extra-light condensate to process in a unit known as a splitter.

With rising crude exports as well as already booming overseas sales of refined petroleum products such as gasoline, the U.S. net oil imports have plunged to below 3 million barrels a day, the lowest since data available starting 45 years ago, compared with more than 12 million barrels a day in 2006. The U.S. could become a net petroleum exporter by 2029, the EIA said This particular week.

U.A.E. crude production was 2.85 million barrels a day in January, according to data compiled by Bloomberg. Output has declined via 3.07 million at the end of 2016 as OPEC as well as allies cut production to reduce a global glut as well as prop up prices.

The cargo was shipped via Enterprise Products Partners LP’s Houston terminal on the tanker Seoul Spirit, which arrived Jan. 31 at the Port of Ruwais in Abu Dhabi, according to ship tracking data compiled by Bloomberg.

Until last year, the U.A.E. relied on Qatar for its condensate supply. however the two countries are embroiled in a political dispute, as well as the U.A.E. decided in June to ban all petroleum ships via Qatar.

— With assistance by Anthony Dipaola, as well as Javier Blas

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