According to data released on January 7, 2025 by ship tracking platform, Kpler Research, global crude oil exports fell by 2% in 2024. Marking the first decline since the Covid-19 pandemic. This contraction is explained by sluggish demand, a restructuring of trade routes and persistent geopolitical disruptions, particularly linked to the war in Ukraine and tensions in the Middle East.
Conflicts in Ukraine and the Middle East have profoundly disrupted global crude oil supplies for the second year in a row. Oil exports from the Middle East to Europe fell by 22% in 2024. While the United States and South America increased their deliveries to the Old Continent.
At the same time, Russian oil, once destined for Europe, has been redirected to India and China.
Adi Emserovich, energy consultant and former oil trader, highlights a strategic rapprochement between Russia, India, China and Iran, which is redefining the dynamics of global oil trade.
With increasing shale oil production, the United States has strengthened its position in the global market, now exporting 4 million barrels per day. Their share in world crude trade thus reaches 9.5%.
Several infrastructural and geopolitical developments also reshaped trade routes:
- The launch of Nigeria’s Dangote mega-refinery has reduced the country’s exports by 13%, while increasing its imports of US crude.
- The expansion of the Trans Mountain pipeline in Canada has increased supplies to the West Coast, reducing reliance on Latin American oil.
- The attacks in the Red Sea have increased transport costs, pushing European refineries to turn more to the United States and Guyana.
Falling demand in major markets
Demand for oil fell in major consumption centers, particularly in China (-3%) and Europe (-1%). This trend is driven by the rise of electric vehicles, increasing adoption of liquefied natural gas (LNG), and policies to reduce carbon emissions.
In China, the rise of renewable energy and plug-in hybrid vehicles has reduced dependence on oil. In Europe, the closure of refineries and climate targets also contributed to the drop in imports.
Uncertain outlook for 2025
Analysts predict continued volatility in the oil market, with factors including potential U.S. sanctions on Iran and President-elect Donald Trump’s proposed tariffs on Canadian and Mexican oil. These measures could further alter trade flows and influence prices globally.
Erik Broekwegen, director of research at Boutin & Partners, sums up the situation: “This type of uncertainty and volatility is the new normal. 2019 was the last “normal” year.
In conclusion, the global oil market is going through a period of major transformation, marked by geopolitical challenges, structural changes and an accelerated energy transition. Players in the sector will have to adapt to this new reality to maintain their competitiveness.
