The United States witnessed a remarkable surge in propane exports in 2023, marking a substantial 14% growth compared to the previous year. Averaging at 1.6 million barrels per day (b/d), the propane exports set an annual record high, constituting 26% of all U.S. petroleum product exports, surpassing other petroleum products in volume.
Propane, widely utilized globally for space heating, is increasingly gaining traction as a petrochemical feedstock, particularly in East Asia. This shift is primarily propelled by the rising demand for propylene production in the region. Propylene, a fundamental chemical, serves as the building block for manufacturing polypropylene, a versatile material extensively employed in various industries, including automotive, packaging, and personal protective equipment.
The surge in propane exports to Asia witnessed a notable 27% increase, amounting to 204,000 b/d, in 2023 compared to the previous year. Among the Asian nations, Japan, South Korea, and China emerged as the primary recipients of U.S. propane exports. Notably, China exhibited the most significant growth, experiencing a staggering 50% increase, equivalent to 72,000 b/d, in 2023.
Meanwhile, distillate fuel, the second-highest U.S. petroleum product export since 2020, faced a contrasting trend. In 2023, exports of distillate fuel oil declined by 8%, totaling 1.1 million b/d. Central America and South America traditionally constitute significant destinations for U.S. distillate fuel exports. However, in 2023, the region witnessed a notable 23% decrease, reaching the lowest level since 2015, with Mexico remaining the top destination country.
The decline in U.S. distillate exports to Brazil played a pivotal role in driving the overall drop in exports to Central and South America. Notably, exports to Brazil plummeted by 67%, declining from 136,000 b/d in 2022 to 45,000 b/d in 2023. Reports from trade press indicate a shift in Brazil’s import sources towards Russia, as the latter explores opportunities beyond European markets for its oil exports.
Despite the decline in exports to Brazil, the Netherlands emerged as a notable destination, witnessing a substantial increase from 36,000 b/d in 2022 to 62,000 b/d in 2023.
Furthermore, gasoline exports from the U.S. witnessed a modest decline of 5% in 2023, averaging at 900,000 b/d. Mexico remained the primary recipient of U.S. gasoline exports, comprising 56% of the total volume. While exports to Mexico remained relatively stable, Brazil experienced a significant decline of 74%, with exports dropping to 28,000 b/d in 2023.
Overall, the dynamics of U.S. petroleum product exports in 2023 underscore shifting global demand patterns and evolving trade relationships, particularly in the energy sector.