The crude tanker market stands to benefit if restrictions on U.S. crude exports are lifted, as it will support more seaborne trade both in and out of the country, according to U.K.-based shipbroker E A Gibson.
In terms of exports, light crude oil would be likely to head across the Atlantic to Europe, lowering the region’s “appetite” for light crude from other sources, primarily West Africa, Gibson predicts.
This in turn would free additional West African volumes for long haul shipments to Asia Pacific customers.
There is also a possibility that U.S. crude could also head directly to Asia.
In contrast, changes in legislation could be bad news for the product tanker market, as the Energy Information Administration (EIA) suggested in its recent report that refiner margins would be under downwards pressure without the current restrictions on crude oil exports.
If that is the case, then freeing up more crude oil for exports will at the very least limit the growth in products exports, both to Latin/South America and across the Atlantic Basin, according to Gibson.
Recently, committees of both the U.S. Senate and U.S. House have initiated and passed legislation seeking to lift the ban on crude oil exports. It is expected that the full U.S. House will consider this bill later this month.