This blog is based on research from Morningstar Commodities. A copy of the original report is available here.
U.S. crude exports out of the Gulf Coast averaged more than 2.4 MMb/d in the first four months of 2019 — using infrastructure that is increasingly constrained by a lack of deepwater ports. U.S. crude is reaching destinations worldwide, with large volumes traveling long distances to Asia on gargantuan 2-MMbbl vessels — Very Large Crude Carriers (VLCCs) — loaded offshore by ship-to-ship transfer. Shipments to Europe are primarily on smaller Suezmax and Aframax vessels. Overall, the increased marine activity is testing the limits of existing infrastructure. Today, we analyze the past 16 months of crude export vessel movements and their impacts on Gulf Coast ports. (We’ll also be discussing this and other critical trends related to U.S. export markets live and in person tomorrow at xPortcon in Houston.)
We’ve covered the development of U.S. crude exports extensively in the blogosphere since the ban on most overseas shipments was lifted in December 2015. Exports from the Gulf Coast are growing and expected to increase further as new pipelines from the Permian and Eagle Ford come online over the next two and a half years (see Hard Hat and a Hammer). In the less than four years since wide-open exporting began, the rapidly developing export market has overcome a number of challenges, like poor price transparency (see The Race is On) and the lack of deepwater terminals to load exports (see Rock The Boat). Actual shipments still require considerable logistical juggling as crude is loaded from smaller tankers onto long-distance VLCCs for voyages to Asia, as detailed in Berth In Reverse. And, as we’ve been discussing in our Slow Ride series, ports like the Houston Ship Channel are contending with increased congestion and the resulting difficulties in scheduling. Plans to expand the onshore ports — and build new deepwater terminals offshore — are in the works, but funding and executing on these projects is not easy and can take many years.
To better understand the nature of the problem, we’ve been examining vessel-level data from our weekly Crude Voyager report. We reviewed every export shipment from Gulf Coast ports between January 1, 2018 and April 24, 2019, including the size of vessel, load terminal and ultimate destination as well as ship-to-ship transfers onto larger tankers. We’ll begin our discussion of what we learned with a closer look at port activity, then break down the characteristics of crude ship movements affecting marine traffic in the Gulf.
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About the song
“Take It to the Limit” was written by Randy Meisner, Don Henley, and Glenn Frey. It was the third single from the Eagles fourth studio album, One of These Nights. It was the only Eagles hit that Randy Meisner sang lead vocals on. Released in November 1975, the song reached #4 on the Billboard Hot 100 and Adult Contemporary charts. Personnel on the song were: Randy Meisner (lead vocals, bass), Glenn Frey (12-string acoustic guitar, backing vocals), Don Henley (drums, backing vocals), Don Felder (lead guitar), Bernie Leadon (electric guitar), and Jim Ed Norman (piano, string arrangement).
One of These Nights was released in June 1975. It was recorded at Criteria Studios in Miami and the Record Plant in Los Angeles, with Bill Szymczyk producing. It went to #1 on the Billboard Top 200 Albums chart and has been certified quadruple Platinum by the Recording Industry Association of America. The album yielded three hit singles.
The Eagles are an American rock band formed in Los Angeles in 1971. They have released 10 studio albums, three live albums, 10 compilation albums, and 30 singles. They have had five #1 singles and six #1 albums and have sold more than 200 million records worldwide. The Eagles have won five American Music Awards and six Grammy Awards and were inducted into the Rock and Roll Hall of Fame in 1998 and the Vocal Group Hall of Fame in 2001. They received Kennedy Center Honors in 2016. Nine members have passed through the group since its formation. Founding member Glenn Frey died in 2016; Randy Meisner died in 2023. The group continues to record and tour and will finish The Long Goodbye Final Tour in March.
