HOUSTON: Rising trade tensions between the United States and China could lead to a decline in U.S. crude oil exports in 2025—the first drop since the pandemic—by restricting access to the Chinese market, analysts warn.
This potential setback contrasts with President Donald Trump’s push to maximize U.S. oil and gas production. Since the 2015 repeal of a 40-year federal ban on crude exports, the U.S. has become the world’s third-largest exporter, trailing only Saudi Arabia and Russia. While exports grew marginally in 2024, the last recorded decline was in 2021, when the COVID-19 outbreak slashed global energy demand.
“International demand for U.S. crude may be peaking, and the trade war could accelerate that shift,” said Matt Smith, an analyst at Kpler. Rohit Rathod, a senior analyst at ship-tracking firm Vortexa, predicts total U.S. crude exports will fall to 3.6 million barrels per day (bpd) in 2025, down from 3.8 million bpd in 2024, as Chinese tariffs reduce demand for American oil.
China’s Role in U.S. Oil Exports
China currently imports about 166,000 bpd of U.S. crude—roughly 5% of total U.S. oil exports. However, with Beijing imposing retaliatory tariffs, some of these shipments could stay in the U.S. or be redirected to other buyers.
The affected volumes will likely consist of medium-density, high-sulfur crude, such as Mars and Southern Green Canyon, which accounted for about 48% of U.S. crude exports to China last year. These medium-sour grades are well-suited for U.S. refineries and could be absorbed domestically, especially if Washington follows through on threats to impose tariffs on Canadian and Mexican oil.
“Medium sours are welcome barrels in the U.S. Gulf Coast. Refiners need it,” Rathod said.
Lighter, low-sulfur crude—such as West Texas Intermediate (WTI)—which makes up the rest of U.S. exports to China, could find alternative buyers in Europe and India at competitive prices, analysts suggest.
Shifts in Export Logistics and Market Response
The Louisiana Offshore Oil Port handled nearly half of all U.S. crude shipments to China last year, according to Kpler. Another 25% came from Enbridge’s Ingleside facility in Texas, though Enbridge’s senior vice president, Phil Anderson, downplayed the impact, noting that China historically accounted for less than 15% of its shipments.
“The market for light crude is very liquid globally,” Anderson said.
Occidental Petroleum, one of the top suppliers of U.S. crude to China, shipped at least 13 cargoes of WTI Midland to China in 2024, per Kpler data. The company has yet to comment on the potential impact of tariffs.
China’s Strategic Oil Shift
For China, the effect of reduced U.S. oil imports is expected to be minimal. In 2024, U.S. crude made up just 1.7% of China’s total oil imports, down from 2.5% in 2023, amounting to approximately $6 billion in trade, according to Chinese customs data.
Instead, China has been ramping up purchases from other sources. Imports from Canada rose by 30% last year to over 500,000 bpd, bolstered by the expansion of the Trans Mountain pipeline. Meanwhile, China has increasingly turned to discounted Russian and Iranian crude, further diminishing its reliance on U.S. oil.-REUTERS
