The first U.S. oil shipments to China in months will reach their destinations just days from now, punctuating a pledge by President Donald Trump in December that China would begin buying more American products despite an ongoing trade battle.
The shipments, which left ports in Texas in late December, are not a clear sign of U.S. victory, however. They are among a handful bound for China or points near it currently as a March negotiating deadline on a new trade deal draws near. And the amount of U.S. oil being shipped to China is well below what it was a year ago, when the trade war erupted.
The U.S. sent the equivalent of 500,000 barrels per day to China in 20 shipments during the months of February, March and April, according to data from Genscape, the world's largest vessel monitoring company. There was only one shipment from the U.S. to China last fall before the two that left in December. Those final two held an average shipment equivalent to 100,000 barrels a day, about one-fifth the size of the spring peak.
"So while the oil deliveries are promising, the fact no subsequent ships are set to arrive after the tariff deadline shows you the pace of the trade discussions," said Hillary Stevenson, director of oil markets and business development at Genscape. "We just have to wait and see. China is buying U.S. crude again but not at its old pace."
Two ships, The Manifa and The Jag Lakshya, are estimated to arrive in China in the middle of February. Genscape can track their movement across the ocean using marine radar technology that shippers use to avoid running into each other on the open water. The journey from Texas to Asia takes about a month and a half, and ships often mark their destination as Singapore when they are really only refueling there before traveling another five days to China.