EIA: US propane export growth drives petroleum product exports

October 3, 2016 By    
Photo courtesy of the U.S. Energy Information Administration (EIA)'s Petroleum Supply Monthly.

A look at the change in U.S. propane exports between the first half of 2015 and the first half of 2016. Graphic courtesy of EIA’s Petroleum Supply Monthly.

Rapid growth in propane exports drove U.S. petroleum product export growth in the first half of 2016, according to the U.S. Energy Information Administration (EIA).

In the first half of 2016, the United States exported 4.7 million barrels per day (bpd) of petroleum products. That’s an increase of 500,000 bpd over the first half of 2015 and almost 10 times the amount of crude oil export volume.

Although U.S. exports of distillate and gasoline increased by 50,000 bpd and almost 140,000 bpd, respectively, propane exports increased by more than 230,000 bpd. Propane is now the second-largest U.S. petroleum product export, surpassing gasoline, EIA reports. While total U.S. petroleum product exports grew, export destinations remained largely unchanged. Mexico, Canada and the Netherlands received the largest volumes of U.S. petroleum products in the first half of 2016.

U.S. propane exports increased from 562,000 bpd in the first half of 2015 to 793,000 bpd in the first half of 2016. Exports to Asia and Oceania accounted for 94 percent of this growth, according to EIA. Japan imported the most propane at 159,000 bpd in the first half of 2016, an increase of 111,000 bpd from 48,000 bpd in the first half of 2015. However, exports to Panama fell from 41,000 bpd in the first half of 2015 to 7,000 bpd in the first half of 2016.

The large increases in exports to Japan and decreases in exports to Panama could be the result of reduced ship-to-ship transfer activity, following narrower price differentials between the U.S. and Asia, EIA adds. Some of the propane exports from the U.S. that undergo ship-to-ship transfers will cite the location of the transfer and not the final destination of the propane. This often results in larger-than-actual export numbers for the countries where the ship-to-ship transfers take place, and in less-than-actual numbers for some final destinations.

In addition, U.S. propane inventories increased to 103.3 million barrels as of Sept. 23. This level is 4.5 million barrels higher than the level at this time last year. Gulf Coast and East Coast inventories increased by 1.7 and 0.2 million barrels, respectively, while Midwest and Rocky Mountain/West Coast inventories decreased by 0.3 and 0.1 million barrels, respectively.

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