Latest news with #SiyiLiu
Yahoo
4 days ago
- Business
- Yahoo
US ethane exports to China hit new roadblock with licence requirement
By Siyi Liu and Arathy Somasekhar SINGAPORE/HOUSTON (Reuters) -Chinese purchases of U.S. ethane, a key petrochemical feedstock, face fresh uncertainty after the Commerce Department told exporters to seek licences to export to China, according to trade sources and shipping data. Washington ordered a broad swathe of companies to stop shipping goods, including ethane and butane, to China without a licence and revoked licences already granted to some suppliers, Reuters reported on Wednesday. The move is the latest disruption in Chinese purchases of U.S. ethane, which hit a record of 492,000 barrels per day in 2024, or nearly half of U.S. exports, according to the U.S. Energy Information Administration. Early last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers who rely on the United States. for almost all their ethane imports. At least two Very Large Gas Carriers were waiting at U.S. ports to load ethane this week while 15 more tankers are headed to, or waiting off, the U.S. Gulf Coast, to load about 284,000 bpd of ethane in June, Kpler data showed. "It's going to be a major issue if all exports are suspended," said a Chinese ethane importer, who sought anonymity because he is not authorised to speak to media. "We are cautiously watching if exporters can obtain new export licences soon." VLGC Pacific Ineos Grenadier was supposed to load ethane for Ineos at Enterprise Products Partners' Morgan's Point terminal at La Porte, Texas, has docked there since last Friday, Kpler and LSEG data showed. Stl Qianjiang is anchored near Energy Transfer's Nederland terminal, due to load ethane for Chinese petrochemical firm Satellite Chemical, the data showed. Enterprise, Energy Transfer and Ineos did not immediately respond to requests for comment outside office hours while Satellite Chemical could not be reached for comment. "The market disruption could be immediate," Julian Renton, an analyst at East Daley Analytics, said in a note. A trade source said Ineos, which also buys ethane for its plants in Europe, may divert its cargo there. In a filing, Enterprise, a top handler of ethane and butane, said it was evaluating its procedures and internal controls and could not determine if it would be able to get a licence. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks. East Daley's Renton said if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Chinese petrochemical firms use ethane as a cheaper feedstock alternative to naphtha, while U.S. oil and gas producers count on China to buy their natural gas liquids as domestic supply exceeds demand. Shares of ethane importers Satellite Chemical were down 3.1% on Friday, while Wanhua Chemical stock lost 1.3%.
Yahoo
08-05-2025
- Business
- Yahoo
Exclusive-US sanctions on China refiners over Iran oil disrupt operations, sources say
By Siyi Liu, Trixie Yap and Chen Aizhu SINGAPORE (Reuters) -Recent U.S. sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to $2.30-$2.40 a barrel against ICE Brent from about $2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by U.S.-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90% of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. SHIPPING, SALES HEADACHES The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around April 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of gasoline blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG shiptracking data showed. That contrasts with the first three months of this year when 83,000 metric tons (701,000 barrels) of methyl tertiary butyl ether, a key gasoline blendstock export, were shipped from Laizhou, accounting for 15% of China's total outflow of the blendstock. State giant CNOOC stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the U.S. sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. CNOOC did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered.
Yahoo
08-05-2025
- Business
- Yahoo
Exclusive-US sanctions on China refiners over Iran oil disrupt operations, sources say
By Siyi Liu, Trixie Yap and Chen Aizhu SINGAPORE (Reuters) -Recent U.S. sanctions on two small Chinese refiners for buying Iranian oil have created difficulties receiving crude and led them to sell product under other names, sources familiar with the matter said, evidence of the disruption that Washington's stepped-up pressure is inflicting on Tehran's biggest oil buyer. The targeting of independent refiners, known as teapots, marked an escalation in Washington's efforts to cut off Tehran's export revenue as President Donald Trump seeks to pressure Iran into a deal over its nuclear programme. Washington's sanctions against Shandong Shouguang Luqing Petrochemical in March and Shandong Shengxing Chemical in April have also begun to deter other, larger independent Chinese refiners from buying Iranian crude, three of the sources said. About five plants in the refining hub of Shandong province have halted purchases of Iranian oil since last month, worried about being hit by sanctions, two trading executives said. That wariness is the main reason discounts for Iranian Light have widened to $2.30-$2.40 a barrel against ICE Brent from about $2 a month ago, the executives and another source said. Among the inconveniences faced by the two sanctioned teapots, state-run Shandong Port Group, the main port operator in the province, has denied entry to vessels loaded with crude they have purchased, five trade sources said. That follows the port group's January ban on port calls by U.S.-sanctioned tankers. Shandong Port Group and Shengxing did not respond to requests for comment. A Luqing executive declined to comment. Large state banks have also stopped providing Luqing with operational capital for purchasing crude, forcing it to work with smaller banks, four of the sources said. The sources declined to be identified due to the sensitivity of the matter. Beijing says it opposes unilateral sanctions and defends as legitimate its trade with Iran, which ships about 90% of its oil exports to China. However, Chinese customs data has not shown any oil shipped from Iran since July 2022, with Iranian crude imports instead labelled as originating from Malaysia or other countries. SHIPPING, SALES HEADACHES The Shandong Port Group's banning of cargoes for the two refineries has forced them to discharge at other ports, according to three sources. In one case, the tanker Bei Hai Ming Wang carrying oil for the Shengxing refinery was rejected when it sought to land at the Laizhou port, controlled by Shandong Port Group, around April 21, according to a source familiar with the matter. It eventually unloaded on May 2 at the privately owned Wantong Crude Oil Terminal in neighbouring Dongying, data from analytics firm Vortexa showed. In another sign of trading disruption from the sanctions, two Asia-based oil product traders who had previously dealt with Luqing said they stopped doing so after it was sanctioned. In addition, no shipments of gasoline blendstock have been recorded since the end of March out of Laizhou port, used by Luqing for most of its blendstock exports, Kpler and LSEG shiptracking data showed. That contrasts with the first three months of this year when 83,000 metric tons (701,000 barrels) of methyl tertiary butyl ether, a key gasoline blendstock export, were shipped from Laizhou, accounting for 15% of China's total outflow of the blendstock. State giant CNOOC stopped supplying crude to Shandong Haihua Group's 40,000 barrel-per-day refinery, operated by Luqing, shortly after the U.S. sanctions were announced, three trade sources and a Shandong-based Chinese oil market consultant said. CNOOC did not respond to a request for comment. Calls to Haihua went unanswered. The two teapots have also begun selling product through new entities, according to seven trade sources, with Luqing using Shouguang Jiaqing Petroleum Sales and Shengxing selling via Shandong Xuxing Petrochemical. Calls to the two entities seeking comment went unanswered.
Reuters
23-04-2025
- Business
- Reuters
Sinopec resumes Russian oil purchase after short pause amid sanctions risks, sources say
SINGAPORE, April 23 (Reuters) - Sinopec, Asia's top refiner, resumed purchases of Russian oil after a brief pause last month to assess risks from sanctions imposed by the United States on Russian entities, trade sources said on Wednesday. Unipec, a trading arm under China's state-run Sinopec ( opens new tab, has bought May-loading Russian Far East ESPO Blend oil, the sources said, having been absent from the trade of March and April-loading ESPO cargoes. It was not immediately clear why Unipec resumed purchases. Sinopec did not immediately respond to a Reuters request for comment. The number of cargoes Unipec purchased is much lower than before the January sanctions were announced, the sources said. The former Biden administration imposed on January 10 harsh sanctions targeting Russian producers Gazprom Neft ( opens new tab and Surgutneftegaz ( opens new tab as well as insurers and more than 100 vessels to curtail Moscow's oil revenue. The sanctions caused Russian oil exports to China and India to fall while Chinese state oil firms Sinopec and Zhenhua Oil suspended purchases of Russian oil, Reuters reported last month. ESPO Blend oil cargoes loading in May traded at premiums of about $2 per barrel against the ICE Brent benchmark on a delivered basis to China, traders said. Reporting by Siyi Liu, Florence Tan and Chen Aizhu in Singapore; Editing by Andrew Heavens, Kirsten Donovan
Yahoo
21-04-2025
- Business
- Yahoo
Sino-US trade war redrawing global LPG trading, outlook
By Trixie Yap, Siyi Liu and Shariq Khan SINGAPORE/NEW YORK (Reuters) -The global liquefied petroleum gas (LPG) market is facing an upheaval as high tariffs on U.S. imports force Chinese buyers to swap American cargoes for alternatives from the Middle East, while U.S. shipments divert to Europe and elsewhere in Asia. The shakeup is expected to depress the shale gas byproducts' prices and demand, hurt the bottom lines of U.S. shale producers and Chinese petrochemical companies, and boost the appetite for alternatives such as naphtha. It is also expected to benefit Middle East suppliers, who are being tapped by the Chinese importers as replacements, and opportunistic LPG buyers in Asia in markets such as Japan and India, who are taking advantage of the product's price declines. Natural gas liquids (NGLs) - propane, ethane and butane - are the latest energy products ensnared in the escalating trade war between the world's two largest economies. China has already halted U.S. crude and liquefied natural gas (LNG) imports. Chinese petrochemical firms reliant on abundant U.S. LPG and ethane supply as feedstock have become the lowest cost producers globally. U.S. oil and gas producers need China to buy their NGLs as domestic supply exceeds demand, and swelling inventories of these products could hurt the economics for shale drillers already facing acute challenges to growth. While U.S. exporters were able to re-route LPG cargoes away from China at the time of trade frictions during U.S. President Donald Trump's first term, the doubling of trade volumes since then makes it difficult for either country to replace the other, said Julian Renton, an NGL analyst at midstream analytics firm East Daley Analytics. "There's a certain amount of flows that could be redirected, but you can't shift 400 kbd to any other market that could take it," he said. China is the second-largest U.S. LPG buyer after Japan, Energy Information Administration data showed. East Daley expects U.S. exports to China could fall by about 200,000 barrels per day (bpd) over six to nine months, leading to higher domestic inventories and depressed prices. Energy Aspects analyst Cheryl Liu expects other LPG importers such as India, Indonesia, Japan and South Korea to buy more of the cheaper U.S. product, while the Middle East ramps up supply to China. "Winners should be all other buyers and Middle East exporters. Losers, I would say, both China and the U.S.," she said. A source at a major Japanese LPG company said unlike Middle East supplies, it is easy to swap U.S. LPG with supply from other countries as U.S. cargoes are not tied to specific destinations. "This will likely accelerate the swapping of U.S. LPG contracts held by the Chinese companies with Middle Eastern, Canadian, and Australian LPG contracts held by Japan, South Korea, Southeast Asian countries and India," he said. "The Chinese will need to offer some incentive to those willing to swap." An Asian LPG trader said Japanese buyers grabbed cheap U.S. imports for end-April and May arrival, with demand mostly from utilities as they restock supply. Japan's U.S. LPG imports are up 12% to 15% on-month so far in April to 274,000-276,000 bpd, provisional data from ship-tracker OilX, and LSEG showed. Data from ship-tracker Kpler showed such imports nearly doubled to 639,000 bpd in April. Indian refiners have asked Middle East suppliers to swap long-term supply with U.S. LPG at discounts to Saudi Contract Price (CP), people familiar with their purchase plans said. CHINA'S IMPORTS Last year, China bought a record 17.3 million tons, or 550,000 bpd, of U.S. propane, 60% of its total imports of the gas liquid, Chinese customs data showed. Chinese buyers are scrambling still to swap U.S. LPG cargoes for supply from other countries to avoid tariffs, traders said. The tariffs come into effect on May 14. While the costs of such swaps were more than $100 per ton for cargoes arriving in the first half of May, Chinese importers have been less inclined to fork out anything above $50 per ton for second-half May supplies, though some sellers are still demanding around $100 per ton for such swaps, the Asian LPG trader said. Meanwhile, the trade war has bolstered premiums of Middle East LPG arriving in China in May to first-half June to $30-$60 a ton against the benchmark contract price, versus pre-trade-war levels of $20-$30, the trader and two Chinese LPG trading executives said. The sources declined to be named as they are not authorised to speak to media. The tariffs on imports from the U.S. are expected to reduce China's LPG demand by 150,000 bpd in the second half of 2025 from the same period a year ago, while increasing naphtha consumption by 140,000 bpd, according to Energy Aspects. However, these will not fully replace the 1.5 million tons monthly U.S. supply, Celia Chen, lead LPG analyst at oil pricing firm Argus told an online seminar, expecting a drop of 1 million tons per month of supply for China. For ethane, a China-based trade source said ethane-based crackers are maintaining their output as of now as their stocks can last until the second-half of May, but major importers have sought import duty waivers from Beijing given that the U.S. is the sole supplier to China. Satellite Chemical told its investors on April 8 it was seeking a waiver of ethane import tariffs, the company disclosed in a filing to the stock exchange.
