(Reuters) - U.S. crude exporters are losing a foothold in China amid an escalating trade dispute that could hand energy rivals’ Saudi Arabia and Russia a bigger share of demand by the world’s second-largest oil consumer.
U.S. crude exports to China last month tumbled, with July deliveries about half the record level 445,000 barrels per day (bpd) in March, according to shipping intelligence firm Kpler.
Flows to China have underpinned surging U.S. crude exports that have reshaped the world’s energy landscape, and the drop comes just a few months after China’s imports of U.S. crude began to climb.
“Depending on the tariffs, U.S. crude exports (to China) could go to zero,” said Olivier Jakob, analyst at consultancy PetroMatrix. “If need be, (China) can live without U.S. crude oil.”
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Several China ports that were big recipients of U.S. crude a few months ago have seen sharply reduced imports, according to Kpler data.
In March, almost 120,000 bpd of U.S. oil had flowed to Rizhao port, in Shandong province, which handles a big chunk of China’s oil imports. But that figure fell to 22,000 bpd in June and to zero in July, shipping data show.
The United States lifted a four-decade ban on crude oil exports at the end of 2015. In that time, China has become one of the largest purchasers of U.S. crude outside of North America.
Reporting by Collin Eaton; editing by Diane Craft