Kpler Crude OIL (Saudi Arabian Exports to the United States)

Originally Released on 17 August 2017

North Sea Floating Storage

Kpler continues to monitor the unusually high floating storage level in Northwest Europe. Beginning in early July, floating storage rapidly increased from 4.41 MMbbl to a peak of 15.92 MMbbl later in the same month. Total volume has since pulled off the peak, but remains within a tight 2.37 MMbbl variance. The Kpler platform reveals several VLCCs holding AIS and/or Fixture destinations in Asia. This tends to align with expectations of further Saudi export cuts. Yet, several of these expected Asia bound vessels, including the Boston, the Olympic Leopard and the Gener8 Supreme, continue to sit idle while fully loaded and holding ETA’s that are or will soon be unachievable.

Saudi Arabian Exports to the United States

In mid-July, Saudi Arabia expressed the intent to further cut exports in order to assist in rebalancing global crude oil supply-demand. The United States represents a key link in this strategy, as it is closely monitored by the broader global market. Kpler data reveals that such cuts have clearly filtered through to monitored trade flows. Between March and July, Saudi exports to the United States have fallen from 36.9 MMbbl to 18.7 MMbbl. It is likely that Saudi implemented deeper cuts well before July.

Year-over-year export differentials indicate a similar story. The graph below indicates how much higher (if a positive number) or lower (if a negative number) are exports from Saudi Arabia in the given 2017 month compared to the same month in 2016. Only March realized a higher level of Saudi exports to the United States compared to the year earlier. These differentials have grown increasingly large over the past few months – 8.4 MMbbl in June and 15.9 MMbbl in July.

Venezuelan Production

The U.S. officially implemented sanctions on several political leaders, including President Maduro in the final week of July. These sanctions were widened to additional leaders a week later. While said sanctions are a key indicator of U.S. frustrations with the political and social problems present there, oil continues to flow out of the nation state. Three key Venezuelan loading installations – Jose Zuata, Jose Oil and Jose Terminal – remain consistently occupied. Last week, 12.7 MMbbl was exported from the country.

Long waiting times continue to hamper crude exports around these three terminals. The following vessels have arrived empty:

  1. The Atlanta Spirit arrived from Chalmette on August 11th. The vessel just entered the Jose Oil berth.
  2. The Phoenix Vigor arrived from Galveston Light on August 14th and is currently awaiting further orders.
  3. The Gener8 Pericles arrived from Castries on August 15th and is currently awaiting further orders.
  4. The Cap Leon arrived from Valero Jean Gaulin on August 16th and is currently awaiting further orders
  5. The Mistral arrived from Tarragona on August 16th and is currently awaiting further orders.

It also appears that the Coral Sea partially loaded at one of the Jose Terminal berths earlier in the week, and expected to re-enter yesterday, August 16th, according to her AIS signal. She is currently awaiting further orders and never re-entered any berth.

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