Based on the latest data from the U.S. Census Bureau, re-exports of Canadian heavy crude oil from the U.S. Gulf Coast shifted sharply lower in July 2023. Re-exports fell back to 100 Mb/d (height of the rightmost stacked bars in the chart below) from a much stronger 246 Mb/d in June, with China and Spain being the only two destinations for Canadian heavy oil from the Gulf in the past three months. The June value was also part of a strong four-month rally in which Canadian heavy oil re-exports were well above 200 Mb/d. In this context, re-exports refer to crude oil that is sourced and exported from Canada to the U.S. and then exported from the U.S. to other nations.
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- Analyst Insight
Re-Exports of Canadian Heavy Crude Oil Set New Record in October
Re-exports of Canadian crude oil from the U.S. Gulf Coast reached a new record of 378 Mb/d in October. China and India led the buying spree in the month.
- Blog
Carefree Highway - Canadian Crude 'Re-Exports' from the USGC Surge on Pipeline Access, Overseas Demand
For many years now, the U.S. has been buying — and piping or railing in — virtually all of the crude oil Canada has been exporting, in part because Canadian producers have only very limited access to coastal ports. More recently, greater pipeline access from the Alberta oil sands to the U.S. Gulf Coast (USGC) has created an attractive pathway — a “Carefree Highway,” if you will — for Canadian crude oil to be “re-exported” to overseas customers. This year, much stronger international demand has sent re-export volumes to record highs — and provided Alberta producers very attractive price differentials for their oil sands crude. That overseas demand appears to be sustainable, but with the looming startup of the 590-Mb/d Trans Mountain Expansion Project (TMX), which will increase the capacity of the Trans Mountain Pipeline system to 890 Mb/d and enable much more Alberta crude to be exported from docks in British Columbia, the re-export surge from the USGC may be in for a pullback, as we discuss in today’s RBN blog.
- Analyst Insight
Re-Exports of Canadian Heavy Crude Oil Conclude 2023 on a Weak Note
Canada's re-exports of heavy crude oil from the U.S. Gulf Coast fell to a six month low in December 2023 as Chinese buyers scaled back purchases. Re-exports may slow further in 2024 once the Trans Mountain Pipeline expansion begins operations in April or May.
