U.S. steps up heavy crude imports as Biden blasts profiteering

HOUSTON, June 16 (Reuters) – U.S. refiners last month imported the heaviest crude in nearly two years, Customs data showed, as they ramped up fuel production and sought to replace sanctioned Russian oil .

Higher imports of heavy crude are common during the summer months, but this year’s increase comes as the Biden administration asks refiners to increase production and cut profit margins to mitigate soaring prices . The administration has requested talks to explore new efforts. Read more

Heavy crudes are cheaper than lighter shale oils produced in the United States and generally produce more diesel and less gasoline. Diesel inventories are running low, with US inventories down 19% last month, and margins are soaring, boosting refiner profits.

Join now for FREE unlimited access to Reuters.com

Refiners imported 33.5 million barrels of heavy crude in May, the highest in nearly two years, according to customs data, with 56 ships dumping nearly 1.1 million barrels per day (bpd) from Maya to the Mexico, Napo and Oriente in Ecuador and Basra in Iraq, among others. the notes.

“We have healthy demand, low product inventories and tight refining capacity,” said Corey Stewart, senior energy analyst at Refinitiv. “Refiners are looking to bring raw materials to the United States to meet the most cost-effective product market demand,” he added.


Increased diesel production will fuel exports to Latin America and Europe, bringing more profits to refiners.

The spread of crack in the United States, a measure of refining margins that includes gasoline and diesel, hit a record high of $62.52 a barrel this month, according to Refinitiv data, as demand fuel has soared with refining capacity down nearly a million barrels per day since 2019.

Big crude buyers included Valero Energy Corp’s Benicia Refinery (VLO.N) and PBF Energy’s Martinez Refinery (PBF.N), both in California, and the Chevron Refinery (CVX.N) in Pascagoula, Mississippi. The barrels also headed to top refiners on the Gulf Coast after being unloaded in Houston, Port Arthur and Corpus Christi, Texas.

Imports of Mexican heavy crudes, mainly Maya and Altamira, hit around 507,000 bpd in May, the highest in 11 months, while fuel oil imports from Mexico neared a record high of 156,000 bpd.

Maya’s official U.S. Gulf Coast delivery price was $110.47 per barrel, compared to an average of $64.29 in 2021. The price reflects higher heavy oil demand and weak supplies from Canada.

The United States also imported a record volume of Basra Heavy crude from Iraq at nearly 129,000 bpd last month, while imports of Ecuadorian Oriente and Napo crudes hit their highest level in a year at around 112,000. bpd.

According to EIA data, imports of Canadian heavy crudes have been tepid, mainly due to the maintenance shutdown of a key upgrader.

U.S. refiners have increased throughput rates to pre-pandemic levels, averaging 93.4% over the past 4 weeks, a level last seen in September 2019, according to Energy Information data. Administration.

Join now for FREE unlimited access to Reuters.com

Reporting by Arathy Somasekhar in Houston; Editing by David Gregorio

Our standards: The Thomson Reuters Trust Principles.

Leave a Comment