Americas News
Vitol Leads First Crude Shipments Following Lifting of U.S. Export Ban
Enterprise Products Partners L.P. (Enterprise) Wednesday announced it will provide pipeline and marine terminal services to load what is likely to be the first export of crude oil produced in the United States following a repeal of the U.S. export ban for crude.
The Vitol Group (Vitol) owned 600,000 barrel cargo of domestic light crude oil is set for export at the Houston Ship Channel Enterprise Hydrocarbon Terminal (EHT) in the first week of January.
The lifting of the 40 year export ban that barred shipments to countries other than Canada came as part of a $1.8 trillion government spending and tax relief bill that was passed and signed into U.S. law last week.
"We are excited to announce our first contract to export U.S. crude oil, which to our knowledge may be the first export cargo of U.S. crude oil from the Gulf Coast in almost 40 years," said A.J. "Jim" Teague, chief operating officer for Enterprise's general partner.
"This action provides new markets to domestic producers, especially producers of light crude oil, and will provide global markets with supply diversification."
Vitol has so far not provided comment on the cargo's destination, nor the crude shipment's pricing.
George Baker, executive director of the Producers for American Crude Oil Exports, has referred to the first few export shipments of U.S. domestic crude as a "stress test" that will help determine where export opportunities exist.
"It's universally agreed in the short term that we won't see a flood of ships leaving for foreign ports because the economics aren't right," commented Sandy Fielden, director of energy analytics at RBN Energy.
Last week, the ESAI Energy wrote that a new deal to allow oil exports from the U.S. is unlikely to give a lift to the country's oil producers for two more years.
