Growing US oil production and flat consumption means more potential US exports over the coming years, according to Poten & Partners weekly tanker opinion.
Tanker research manager Erik Broekhuizen says recent projections on forward supply and demand from the US Energy Information Administration (EIA) are a “boon to the tanker market (both crude and products).”
“Growing crude oil production in the face of negligible domestic demand growth makes more volumes available for exports,” according to Broekhuizen.
The EIA expects US crude oil exports to more than double over the next 25 years, hitting 1 million barrels per day by 2040. Meanwhile, the US will continue to import between 7 million and 8 million barrels per day of oil from overseas producers due to the ongoing need for particular grades of oil.
“This scenario provides ongoing support for medium sized crude oil tankers, primarily in the Atlantic Basin,” Broekhuizen wrote. “If additional investments in export infrastructure are made, VLCCs (very large crude carriers) may also benefit.”
Clean products, which are the primary energy export of the US currently, will also see gains. The EIA expects diesel and gasoline exports to grow an average of 2% annually 7 million barrels per day over the forecast period.
“All in all, both the crude and product tanker markets look to benefit as the United States takes centre stage again in world energy markets,” Broekhuizen writes.
