The latest shipping data shows that with the temporary peace agreement reached between the United States and Iran in June, the increase in Middle East oil supply has led to a decrease in demand for US crude oil from buyers in Asia and Europe, resulting in a continued decline in US exports.
Ship tracking data indicates that in July, US crude oil exports averaged 3.66 million barrels per day, significantly lower than the historical peak of 5.7 million barrels per day reached in May, marking the lowest level in nearly eight months.
Analysis from Reuters suggests that after the temporary peace agreement between the US and Iran in June, more Middle East oil has re-entered the international market, reducing overseas buyers’ reliance on US crude oil. Additionally, the increased traffic of oil tankers in the Strait of Hormuz also indicates a recovery in Middle East oil exports.
Notably, the decrease in demand in the Asian market is most pronounced. In July, US crude oil exports to Japan decreased by 67% compared to the previous month, and exports to South Korea dropped by 39%; European imports also decreased from 2.5 million barrels per day in May to around 1.7 million barrels in July.
Furthermore, US Strategic Petroleum Reserve (SPR) crude oil exports have also decreased. On the other hand, US refinery operating rates have risen to 96.3%, leading to more crude oil being processed domestically, further compressing export volumes.
Nevertheless, market analysts expect that US crude oil exports are likely to rebound in August and September. With the price difference between US West Texas Intermediate (WTI) and Brent crude oil widening again, the attractiveness of US crude oil prices to overseas buyers has improved, and export volumes are expected to exceed 4 million barrels per day again. However, reaching the historical peak set in May remains challenging.