Release date: September 6, 2018 | Next release date: September 12, 2018
Crude oil was the largest U.S. petroleum export in the first half of 2018
The United States exported 7.3 million barrels per day (b/d) of crude oil and petroleum products in the first half of 2018, when exports of crude oil and hydrocarbon gas liquids (HGL) set record monthly highs. Crude oil surpassed HGLs to become the largest U.S. petroleum export, with 1.8 million b/d of exports in the first half of 2018. U.S. exports of crude oil, HGLs, and motor gasoline grew in the first half of 2018 compared with the same period in 2017, while distillate exports decreased 84,000 b/d (Figure 1).
U.S. crude oil exports increased by 787,000 b/d (almost 80%) from the first half of 2017 to the first half of 2018 and set a new monthly record of at 2.2 million b/d in June. Destinations in Asia and Oceania were the largest recipients of U.S. crude oil exports in the first half of 2018, and U.S. crude oil exports to China more than doubled—increasing by 193,000 b/d—from the first half of 2017. U.S. crude oil exports to South Korea and India also increased significantly during this period, up 81,000 b/d and 72,000 b/d, respectively.
Europe was the second-largest market for U.S. crude oil exports, receiving 555,000 b/d in the first half of 2018. U.S. crude oil export volumes to Europe are more equally distributed than in other regions. Italy, the United Kingdom, and the Netherlands, each received more than 120,000 b/d in the first half of 2018. Canada was the only major U.S. crude oil export destination where exports decreased somewhat, down 13,000 b/d in the first half of 2018 compared with the same period in 2017 (Figure 2).
HGLs were the second-largest petroleum export from the United States in the first half of 2018 at 1.6 million b/d. Destinations in Asia and Oceania were also the primary recipients of U.S. HGLs at 618,000 b/d in the first half of 2018. The region’s main importers were Japan, South Korea, China, and India, many of which have expanded petrochemical facilities that import U.S. HGLs as a feedstock. The second-largest regional destinations for U.S. HGL exports in the first half of 2018 were Canada and Mexico in North America, which received a combined 453,000 b/d in the first half of 2018 (Figure 3). U.S. HGL exports also set a new monthly record in the first half of 2018 at 1.7 million b/d in May 2018.
In the first half of 2018, the United States exported 1.3 million b/d of distillate, primarily to destinations in Central and South America, with Brazil and Chile as the two largest destinations, receiving 131,000 b/d and 114,000 b/d, respectively. The decline in U.S. distillate exports in the first half of 2018 compared with the first half of 2017 is mostly the result of lower exports to a number of destinations in Central and South America and in Europe. However, U.S. distillate exports are typically higher in summer months, most of which occur in the second half of the year. The largest single destination for U.S. distillate exports in the first half of 2018 was Mexico at 289,000 b/d (Figure 4). Despite being the third-largest U.S. petroleum export, U.S. distillate exports go to the largest number of destinations—as 49 different destinations received at least 1,000 b/d in the first half of 2018.
The United States exported 913,000 b/d of motor gasoline in the first half of 2018, an increase of 144,000 b/d compared with the same period in 2017. Mexico accounted for more than half of U.S. motor gasoline exports in the first half of 2018, the largest single-destination concentration for any U.S. petroleum export (Figure 5). Years of underinvestment in Mexico’s refineries, combined with a mismatch between the type of crude oil produced locally and the type of crude oil Mexico’s refineries were designed to process, has resulted in low refinery utilization rates. Low refinery utilization has resulted in increased imports of motor gasoline and other petroleum products, from the United States. Mexico’s gasoline consumption ranges from 780,000 b/d to 800,000 b/d based on recent history. In the first half of 2018, U.S. gasoline exports to Mexico accounted for more than 60% of the gasoline consumed in Mexico.
U.S. average regular gasoline price decreases, diesel price increases
The U.S. average regular gasoline retail price decreased less than 1 cent from last week to $2.82 per gallon on September 3, 2018, up 15 cents from the same time last year. West Coast prices increased nearly two cents to $3.33 per gallon, and East Coast and Rocky Mountain prices each rose over one cent to $2.78 per gallon and $3.01 per gallon, respectively. Midwest prices fell nearly three cents to $2.73 per gallon and Gulf Coast prices decreased two cents to $2.55 per gallon.
The U.S. average diesel fuel price increased over 2 cents from last week to $3.25 per gallon on September 3, 2018, 49 cents higher than a year ago. Midwest prices increased nearly four cents to $3.19 per gallon, Gulf Coast prices rose over three cents to $3.04 per gallon, West Coast prices increased more than two cents to $3.74 per gallon, and East Coast prices increased over one cent to $3.24 per gallon. Rocky Mountain prices were unchanged, remaining at $3.36 per gallon.
Propane/propylene inventories rise
U.S. propane/propylene stocks increased by 2.0 million barrels last week to 73.4 million barrels as of August 31, 2018, 9.7 million barrels (11.7%) lower than the five-year (2013-2017) average inventory level for this same time of year. Midwest, Gulf Coast, and East Coast inventories increased by 1.2 million barrels, 0.5 million barrels, and 0.3 million barrels, respectively, while Rocky Mountain/West Coast inventories fell slightly, remaining virtually unchanged. Propylene non-fuel-use inventories represented 3.9% of total propane/propylene inventories.
For questions about This Week in Petroleum, contact the Petroleum Markets Team at 202-586-4522.
Retail prices (dollars per gallon)
| Retail prices | Change from last | ||
|---|---|---|---|
| 09/03/18 | Week | Year | |
| Gasoline | 2.824 | -0.003 | 0.145 |
| Diesel | 3.252 | 0.026 | 0.494 |
Futures prices (dollars per gallon*)
| Futures prices | Change from last | ||
|---|---|---|---|
| 08/31/18 | Week | Year | |
| Crude oil | 69.80 | 1.08 | 22.51 |
| Gasoline | 2.144 | 0.066 | 0.396 |
| Heating oil | 2.241 | 0.039 | 0.494 |
| *Note: Crude oil price in dollars per barrel. | |||
Stocks (million barrels)
| Stocks | Change from last | ||
|---|---|---|---|
| 08/31/18 | Week | Year | |
| Crude oil | 401.5 | -4.3 | -60.9 |
| Gasoline | 234.6 | 1.8 | 7.9 |
| Distillate | 133.1 | 3.1 | -14.6 |
| Propane | 73.404 | 2.004 | -6.495 |