HOUSTON/NEW YORK—U.S. crude exports from Corpus Christi, Texas, have surged to a record in recent weeks, often surpassing hubs such as Houston and Beaumont, Texas, thanks to faster-than-expected infrastructure additions.
The infrastructure boom at Corpus Christi helped push crude exports there to a weekly record of 1.59 million barrels per day (bbl/d) in late December, more than doubling levels that held for the first eight months of last year, and above Houston’s 2019 peak of 1.36 million bbl/d, according to vessel-tracking firm ClipperData.
The heavy flows suggest that fears of a bottleneck that would impede U.S. exports have not materialized.
“Those (export) numbers are truly astonishing, and at times, Corpus volumes have accounted for more than half of all crude exports moving out of the U.S. on a weekly basis,” said John Zanner, senior strategist at Uplift Energy Strategy.
The four-week average of overall U.S. crude exports reached a record 3.72 million bbl/d in the week ended Dec. 27, according to the U.S. Energy Information Administration (EIA).
Analysts had expected a crude bottleneck in the Permian Basin to shift to the Gulf Coast as three new pipelines opened last year. New flows out of the nation’s biggest oil field were expected to overwhelm export capacity in Corpus Christi and weigh on regional prices.
But the rush of crude has been absorbed following last year’s addition of almost 2 million bbl/d of inbound pipeline capacity and 5 million barrels of storage capacity in Corpus Christi, according to market intelligence provider Genscape.
Analysts expect flows to rise further as three new pipelines from the Permian Basin to the U.S. Gulf Coast begin full service in the first half of 2020. The lines are owned by EPIC Midstream, Plains All American Pipeline LP and Phillips 66 Partners LP.
Another 18 million barrels of storage capacity were under construction in the Corpus Christi area in the week to Jan. 3.
Waterborne trading dominates Corpus Christi, in contrast to Houston markets where the established grade trades at Magellan’s East Houston terminal. Corpus prices have on average traded 50 cents to $1 per barrel below West Texas Intermediate (WTI) crude at Magellan East Houston, traders and analysts said.
Devon Energy had been actively shopping the Permian Basin assets, and others in the Rockies, the past several months.
A big crowd turned out for an afternoon honoring industry leaders representing all facets of the energy sector.
Oil major Exxon Mobil said Jan. 31 it would create three new separate E&P companies, effective April 1, in an effort to double its profit by 2025.