Alaska oil exports to S. Korea pick up
Taylor Holman, who sends out the Alaska Department of Revenue’s weekday oil price report, included an interesting story from Bloomberg in his July 24 email.
The article, “Korea Shows Growing U.S. Reach,” said Alaska oil shipments to South Korea are picking up, seeing it as “sign of the growing U.S. influence on the global market.”
Two tankers, the Polar Adventure and Alaskan Explorer, each able to hold a million barrels of oil, delivered cargoes in July to Yeosu in South Korea after filling up at Alaska’s Valdez terminal.
“These shipments will raise the Asian nation’s intake of supply from the U.S. state to 2.75 million barrels so far this year, the most in government data going back to 1992,” the article reported, noting the shipments “may be” destined for GS Caltex, operator of the 790,000 barrel-a-day Yeosu refinery.
U.S. crude exports have climbed after a 40-year ban on Lower 48 shipments abroad was lifted by Congress at the end of 2015 and signed into law by the president in early 2016, allowing those producers to join Alaska in being allowed to export domestic crude supplies to overseas markets.
U.S. Sen. Lisa Murkowski, R-Alaska, said at the time that, “lifting the ban will also be good for Alaska: it will alleviate competition for our oil at West Coast refineries, increase the price we receive for Alaska North Slope crude, and remove all remaining uncertainty about our long-term ability to export.”
South Korea, Bloomberg reported, “has increased its imports, and was the second-biggest destination for American crude in May. The country’s biggest refiner, SK Trading International Co., is looking to buy more varieties of U.S. crude.”
Global supplies of Alaska crude “have tightened after U.S. sanctions on Venezuela and Iran and output cuts by the OPEC and its allies. Supplies were further reduced by contamination of Russian Urals crude,” the news service reported.
“There’s been a lack of Iranian crude exports that would otherwise have been taken by Asian refiners” because of sanctions, said Andy Lipow, president of Lipow Oil Associates LLC., quoted in the article.
North Slope oil has become more competitive because Dubai, the benchmark for Middle Eastern crudes, has gained relative to global marker Brent, Lipow was attributed as saying.
On July 23 ANS crude closed at $65.20, up 85 cents from the previous day.
- KAY CASHMAN