China’s Tariffs Could Drag Down U.S. Crude Oil Exports

China’s Tariffs Could Drag Down U.S. Crude Oil Exports | OilPrice.com

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Breaking News:

ByTsvetana Paraskova– Feb 06, 2025, 7:30 AM CST

The 10% Chinese tariff on imports of U.S. crude oil could push American crude exports lower in 2025 from the record highs seen in the past two years, analysts tell Reuters.

On the day on which the U.S. blanket tariff of 10% on all Chinese imports took effect, China responded with several measured retaliatory tariffs, including a 15% levy on LNG and 10% on crude oil imports from the United States.

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U.S. crude accounted for about 5% of China’s total crude oil imports in 2024, as Chinese refiners imported about 166,000 barrels per day (bpd) of American crude volumes, per vessel-tracking data from Kpler cited by Reuters.

Expectations are that China will significantly reduce or halt altogether U.S. crude imports due to the tariff.

This could contribute to a decline in overall international demand for U.S. oil, according to Kpler.

U.S. crude exports hit a record of over 4 million bpd in 2023, and were essentially flat last year, trade flow tracking showed.

Per Kpler’s estimates, American crude exports rose only marginally last year from the previous year, and were up by just 24,000 bpd to average 3.8 million bpd in 2024.

U.S. crude oil exports could be peaking and “China’s retaliatory tariffs could only further accelerate that,” Kpler analyst Matt Smith told Reuters.

American seaborne exports averaged 3.9 million bpd in 2024, down from 4 million bpd in 2023, per data from Vortexa.

“Americas crude exports started to stagnate during the second half of 2024 with the US, the largest exporter, showing signs of slowdown,” Rohit Rathod, Senior Oil Market Analyst at Vortexa, said last month.

U.S. crude exports could slide to 3.6 million bpd this year, especially if the Trump Administration enacts the tariffs on Mexico and Canada – currently on pause until March 4 – and more of the U.S. medium sour grades, such as Mars and Southern Green Canyon, is kept for domestic refining, Vortexa’s Rathod told Reuters.

By Tsvetana Paraskova for Oilprice.com

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