U.S. crude oil exports surged to a record 5.2 million barrels per day in April, according to data from commodities data firm Kpler.

Exports are surging as buyers in Asia and elsewhere seek U.S. crude oil as an alternative to Middle East supplies lost due to the Iran war.

Corpus Christi, Texas, one of the largest oil export terminals in the earth, had the busiest first quarter in its history.

The Port of Corpus Christi has never been busier as tankers from around the planet flock to the U.S. Gulf Coast to load up on crude oil during the Iran war.

The Texas port was the third-largest oil export terminal in the earth before the war behind Ras Tanura in Saudi Arabia and Basra in Iraq.

Its importance has only grown since, as U.S. crude oil exports have surged to a record and the two significant Persian Gulf ports are largely cut off from the globe due to Iran’s blockade of the Strait of Hormuz.

U.S. oil exports have jumped to 5.2 million barrels per day (bpd) in April, a more than 30% growth over the 3.9 million bpd exported in February before the war, according to data from Kpler.

March was the busiest month in the history of the Port of Corpus Christi, and the first quarter was its busiest quarter ever, remarked CEO Kent Britton. Oil exports have increased to about 2.5 million barrels per day since the war started compared to 2.2 million bpd last year, Britton mentioned.

Ship traffic in Corpus Christi rose to more than 240 vessels in March compared to the 200 the port normally sees in a month, the CEO noted.

“It’s a constant parade of tankers coming in and out,” he stated.

Asian buyers

Corpus Christi accounted for about half of U.S. crude oil exports in April while Houston made up most of the rest, according to data from Kpler.

Some 50 to 60 significant tankers called very large crude carriers (VLCCs) are heading to U.S. ports on any given day right now, double the volume seen last year, Kpler’s data shows. VLCCs can typically carry up to 2 million barrels.

Many of those tankers are coming from Asian countries that imported their oil from the Middle East before the war, remarked Matt Smith, director of commodity research at Kpler. They are now turning to the U.S. Gulf Coast because the trade route into the Persian Gulf through the strait is effectively closed.

“Asian markets are buying whatever they can get their hands on, so they’re taking a lot of light sweet crude,” Smith stated.

Corpus Christi has also seen a massive expansion of refined product exports to the Middle East. The volume of those exports to the region was higher in the first quarter than all of last year, Britton, the CEO, noted.

Export limits

The re-routing of ships to the U.S. Gulf Coast is probably more of a wartime crisis measure than a permanent realignment of Asian buyers to the U.S.

Light sweet crude oil that the U.S. produces is a poor substitute for sour Middle East barrels because of the way many refineries are configured to optimize heavy feedstocks, Smith at Kpler stated.

What’s more, U.S. oil exports are probably capped somewhere just above 5 million bpd just due to dock capacity, mentioned Smith. Corpus Christi’s export capacity maxes out at about 2.6 million bpd due to pipeline constraints, but could probably handle another 500,000 bpd if pipelines were expanded, CEO Britton stated.

The U.S., Latin America and West Africa can help supply incremental barrels to Asian buyers in need. But the Middle East is just too massive of an oil producer to be replaced, Smith mentioned. Some 20% of global oil supplies were exported through the strait before the war.

“It’s a hole that can’t be plugged,” Smith stated. “The answer has to be ensuring secure supply from the Middle East.” This also touches on aspects of dividends.