Lifting the US crude oil export ban and logistics developments bring changes to crude flows
The lifting of the US crude oil export ban allows for a new cross-trade to develop wherein light and super light crudes – not well-fitted to US refinery configurations – are exported, which leaves room for heavier, sour crudes to be imported. Canadian exports may become hampered by a lack of sufficient pipeline (plus rail) capacity unless new projects are built in the next few years. Of four major pipeline projects, two may go ahead, one to the west and one to the east. These would impact crude flows. From less than 0.1 mb/d in 2015 and 0.5–0.6 mb/d by mid-2016, crude oil exports from the US & Canada are projected to exceed 1 mb/d by 2020 and 2 mb/d by 2035, based on the outlooks for crude and condensate supply in each country.
The primary trend in long-term oil trade is growing crude imports into the Asia-Pacific from the Middle East
As product demand and crude runs decline in the industrialized regions, so too do their crude oil imports. Combined crude oil imports into the US & Canada, Europe, Japan and Australasia drop by 3 mb/d between 2015 and 2040. In marked contrast, imports into the Asia-Pacific region grow by nearly 9 mb/d during the same period as this region remains the primary focus of demand growth. Of this increase, over 6.5 mb/d comprises growth in exports from the Middle East. Increased flows, mainly via the ESPO pipeline, will progressively raise imports from the Russia & Caspian region, but the Middle East to the Asia-Pacific dominates crude trade growth going forward.