By John Hill - Own work, CC BY-SA 3.0,
An emerging trade conflict between the United States and China may lead to a decline in US crude exports in 2025, marking the first decrease since the pandemic, as access to the Chinese market becomes restricted, according to analysts.
This forecast highlights a possible unintended effect of President Donald Trump’s protectionist measures, which contradict his administration’s commitment to maximizing the already record-high production of US oil and gas.
Since the removal of a 40-year federal ban on domestic oil exports in 2015, the United States has ascended to become the world’s third-largest exporter, trailing only Saudi Arabia and Russia. Although US crude exports experienced only a modest increase in 2024, the last recorded decline occurred in 2021, following the significant reduction in global energy demand due to the Covid-19 pandemic.
Matt Smith, an analyst at Kpler, noted that international demand for US crude may be reaching its peak, which could further exacerbate the situation.
Rohit Rathod, a senior analyst at the ship tracking company Vortexa, projected that total US oil exports would decrease to 3.6 million barrels per day in 2025, down from 3.8 million bpd in 2024, as Chinese tariffs prevent certain US oil grades from entering the market.
China imports approximately 166,000 barrels of U.S. crude oil each day, accounting for about 5 percent of total U.S. export shipments. Following Beijing’s announcement of retaliatory tariffs this week, a portion of these exports may remain within the United States or be redirected to alternative markets.
The decline in exports is expected to primarily consist of medium-density oils with higher sulfur content, such as Mars and Southern Green Canyon, which are classified as medium-sour grades. Last year, these grades represented nearly 48 percent of the crude oil imported by China from the U.S.
These medium-sour grades are well-suited for U.S. refineries and could readily attract domestic buyers, especially if the U.S. proceeds with its threats to implement new tariffs on oil from Canada and Mexico, according to analysts.
“Medium sours are highly sought after in the U.S. Gulf Coast. Refineries require them,” stated Rathod.
The majority of China’s crude oil imports from the U.S. comprised lighter density, lower-sulfur varieties, such as West Texas Intermediate, which are categorized as light, sweet grades.
Analysts noted that this type of oil could be redirected to refiners in Europe and India at competitive rates.
According to Kpler, the Louisiana Offshore Oil Port managed nearly half of all U.S. exports to China last year. The company was not immediately available for comment.
Additionally, around 25 percent of U.S. exports to China originated from Enbridge’s Ingleside facility in Texas, located near Corpus Christi, as indicated by Kpler data.
Phil Anderson, a senior Vice President at Enbridge, remarked that the facility would experience minimal impact, as less than 15 percent of its historical volumes have been sent to China.
The global market for light crude is currently characterized by high liquidity, he stated. Among the leading exporters of U.S. crude to China is Occidental Petroleum, which reportedly sold a minimum of 13 cargoes of light, sweet WTI Midland to the country in 2024, as per data from Kpler.
Occidental has not yet responded to a request for comment.
For China, the effect appears to be limited, as U.S. imports constituted only 1.7 percent of the nation’s total crude imports in 2024, amounting to approximately $6 billion, according to data from Chinese customs, a decrease from 2.5 percent in 2023.
Last year, China increased its imports from Canada by around 30 percent, surpassing 500,000 barrels per day, largely due to the expansion of the Trans Mountain pipeline. Additionally, China’s demand for U.S. oil has waned in recent years, influenced by the availability of discounted oil from Russia and Iran.
