Tankers: Export Flows Could Increase from West to East
Increased Venezuelan oil production led by Chevron and Eni is expected to shift global crude dynamics, potentially boosting long-haul tanker demand from the Atlantic to Asian markets.
According to a report by Hellenic Shipping News, major energy firms are expanding their footprint in Venezuela to significantly increase output. Chevron has secured new acreage in the Orinoco Belt with plans to invest $7 billion to reach 600,000 barrels per day. Simultaneously, Eni has taken control of the Junín-5 field, aiming to raise production from its current minimal levels to 400,000 barrels per day through substantial annual spending.
Shipbroker Gibson suggests that while U.S. officials anticipate regional production hitting 1.5 million barrels per day by 2027, the total scale of growth remains uncertain. While the U.S. maintains significant offtake rights and could use the crude to replenish the Strategic Petroleum Reserve, Goldman Sachs expressed skepticism that production will surpass 2 million barrels per day in the near term due to the massive capital requirements involved.
The surge in supply is expected to alter traditional shipping routes as domestic demand in the U.S. for heavy sour crude has declined over the past decade. Once U.S. and European refiners reach their capacity for these grades, Gibson expects additional volumes to move toward Eastern markets. This shift could create a larger crude surplus in the Atlantic Basin, encouraging more long-haul export flows from West to East.
Helena Marsh — Energy Markets Editor. Helena covers crude, refined products and the trading houses that move them, with a focus on price formation in the Mediterranean and Black Sea.
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