Latest news with #VLGCPacificIneosGrenadier
The Sun
3 days ago
- Business
- The Sun
US ethane exports to China hit new road block with license requirement
SINGAPORE/HOUSTON: U.S. exporters face potential disruption to their shipments of petrochemical feedstock ethane after the Commerce Department told them to seek licenses to export to top buyer China, according to trade sources and shipping data. Chinese petrochemical producers rely on the United States for almost all their ethane imports, buying about half of the total U.S. exports of the gas. Washington ordered a broad swath of companies to stop shipping goods to China without a license and revoked licenses already granted to some suppliers, Reuters reported on Wednesday. Those goods included ethane, as well as butane gas. If U.S. exporters are unable to obtain licenses quickly, they will need to seek alternative buyers. Costs for Chinese petrochemical makers will rise as they compete for alternative sources of ethane or switch to another more expensive petrochemical feedstock such as naphtha. China imported a record 230,000 barrels per day (bpd) of ethane from the United States last year, according to the U.S. Energy Information Administration. Ethane is a byproduct of oil and gas production and is primarily used to make plastics. The exports have been caught in the trade war between the U.S. and China. Last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers. At least two Very Large Gas Carriers (VLGC) 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 authorized to speak to media. 'We are cautiously watching if exporters can obtain new export licenses soon.' Petrochemical producer Ineos was scheduled to load ethane on VLGC Pacific Ineos Grenadier from Enterprise Products Partners' terminal in Morgan's Point, Texas, on May 24 for export to China, according to Kpler shipping tracking data. The ship docked on May 24 but has yet to load, according to LSEG tracking data. Enterprise, a top exporter of ethane, said in a regulatory filing on Thursday that it had received a letter from the Commerce Department on May 23 requiring a license to export ethane and butane to China. Enterprise said it was evaluating its procedures and internal controls and could not determine if it would be able to obtain a license. Enterprise and Ineos did not respond to requests for comment. The U.S. Commerce Department did not immediately respond to a request for comment. Ineos may divert the cargo to one of its European plants if it cannot ship it to China, one trade source said. The next vessel expected to load for ethane exports to China is the Stl Qianjiang, which is anchored near Energy Transfer's Nederland terminal, the data showed. That vessel is scheduled to ship ethane to Chinese petrochemical firm Satellite Chemical. Energy Transfer did not respond to requests for comment, while Satellite Chemical could not be reached for comment. 'We will continue working with the administration to ensure there are no unnecessary obstacles to these important trade flows,' said Dustin Meyer, senior vice president of Policy, Economics and Regulatory Affairs at the American Petroleum Institute trade group. 'The market disruption could be immediate,' Julian Renton, an analyst at East Daley Analytics, said in a note. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks to keep operations going for now. East Daley's Renton said that if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Shares of Enterprise were down 1.12% on Friday, while Energy Transfer shares were down 1.4%. Shares of ethane importers Satellite Chemical were down 3.1% earlier on Friday, while Wanhua Chemical stock lost 1.3%.
The Sun
3 days ago
- Business
- The Sun
US ethane exports to China face new licensing hurdles
SINGAPORE/HOUSTON: U.S. exporters face potential disruption to their shipments of petrochemical feedstock ethane after the Commerce Department told them to seek licenses to export to top buyer China, according to trade sources and shipping data. Chinese petrochemical producers rely on the United States for almost all their ethane imports, buying about half of the total U.S. exports of the gas. Washington ordered a broad swath of companies to stop shipping goods to China without a license and revoked licenses already granted to some suppliers, Reuters reported on Wednesday. Those goods included ethane, as well as butane gas. If U.S. exporters are unable to obtain licenses quickly, they will need to seek alternative buyers. Costs for Chinese petrochemical makers will rise as they compete for alternative sources of ethane or switch to another more expensive petrochemical feedstock such as naphtha. China imported a record 230,000 barrels per day (bpd) of ethane from the United States last year, according to the U.S. Energy Information Administration. Ethane is a byproduct of oil and gas production and is primarily used to make plastics. The exports have been caught in the trade war between the U.S. and China. Last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers. At least two Very Large Gas Carriers (VLGC) 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 authorized to speak to media. 'We are cautiously watching if exporters can obtain new export licenses soon.' Petrochemical producer Ineos was scheduled to load ethane on VLGC Pacific Ineos Grenadier from Enterprise Products Partners' terminal in Morgan's Point, Texas, on May 24 for export to China, according to Kpler shipping tracking data. The ship docked on May 24 but has yet to load, according to LSEG tracking data. Enterprise, a top exporter of ethane, said in a regulatory filing on Thursday that it had received a letter from the Commerce Department on May 23 requiring a license to export ethane and butane to China. Enterprise said it was evaluating its procedures and internal controls and could not determine if it would be able to obtain a license. Enterprise and Ineos did not respond to requests for comment. The U.S. Commerce Department did not immediately respond to a request for comment. Ineos may divert the cargo to one of its European plants if it cannot ship it to China, one trade source said. The next vessel expected to load for ethane exports to China is the Stl Qianjiang, which is anchored near Energy Transfer's Nederland terminal, the data showed. That vessel is scheduled to ship ethane to Chinese petrochemical firm Satellite Chemical. Energy Transfer did not respond to requests for comment, while Satellite Chemical could not be reached for comment. 'We will continue working with the administration to ensure there are no unnecessary obstacles to these important trade flows,' said Dustin Meyer, senior vice president of Policy, Economics and Regulatory Affairs at the American Petroleum Institute trade group. 'The market disruption could be immediate,' Julian Renton, an analyst at East Daley Analytics, said in a note. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks to keep operations going for now. East Daley's Renton said that if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Shares of Enterprise were down 1.12% on Friday, while Energy Transfer shares were down 1.4%. Shares of ethane importers Satellite Chemical were down 3.1% earlier on Friday, while Wanhua Chemical stock lost 1.3%.
Yahoo
3 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%.
