American exports of natural gas liquids reached a record level in April, despite the trade war between the United States and China, which reduced shipments to the first buyer, according to ship’s monitoring data.
The recent trade developments have threatened American exports of natural gas liquids (LGN), such as ethane, butane and propane, used in the manufacture of plastics and chemicals, as well as for heating and kitchen. American exports have reached a new record each year since 2010 thanks to the abundance of natural shale gas.
LNGs, mainly extracted from raw natural gas during their treatment, are the last energy products taken in the climbing of the trade war between the two largest world economies.
Almost half of American ethane exports are intended for China, and all Chinese ethane imports come from the United States, which has practically no other source of supply, according to US government statistics. Chinese petrochemical companies use it as raw material because it is cheaper than Naphta, while US oil and gas producers need China to buy their natural gas liquids, as the interior supply exceeds demand.
The United States has exported approximately 2.9 million barrels per day (BPJ) from LGN in April, a record level, according to data from the monitoring companies for KPLER and VORTEXA ships.
However, exports to China fell 35 % to 619,000 b/d during the month, according to KPLER data, their lowest level since November 2023. China has given up customs duties of 125 % on ethane imports from the United States imposed at the beginning of the month, two sources told Reuters this week.
Other countries have increased their US LGN purchases in the world, compensating for the loss of Chinese purchases for the United States.
India has more than tripled its purchases to reach a record level of 179,000 barrels per day, according to KPLER data.
Brazil has more than doubled its purchases to reach 113,000 barrels per day, their highest level in five years, while Japan, the second buyer of American natural gas liquids, increased its imports by 64 % to reach almost 400,000 barrels per day, their highest level since February 2023.
American ethane production will increase by 3.6 % to reach 2.9 million barrels per day this year, according to forecasts from the Energy Information Administration, which adds that most of this growth will be exported to meet growing international demand.
“The market has already been reached to reachminate barrels between the world’s largest suppliers of liquefied oil gas (a mixture of propane and butane), the United States and the Middle East, and the largest importing countries, namely China and India,” said Jim Teague, general co-director of Enterprise Products Partners, one of the main exporters of Americans, at a conference call on quarterly results.
The company said that he did not find any disruption of its exports of ethane, propane or butane.
His competitor Energy Transfer, also one of the largest exporters of the American LGN, said that he had no problem finding outlets for his ethane or his LPG.
Enterprise Products said that the total volume transported by its LGN pipelines had increased by 5 %, while the volume treated with its maritime terminals had increased by 11 %. The volume transported by Energy Transfer increased by 4 % in the first quarter, while exports increased by 5 %. (Report of Arathy Somasekhar and Georgina McCartney in Houston; edited by David Gregorio)
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