Oil trader Trafigura profits from growing USA crude exports

Bloomberg

Over nearly 45 years, the oil tanks at Milford Haven on the U.K. west coast have stored dozens of crude varieties: from North Sea Brent to Nigeria’s Bonny Light and almost everything in between. Now, for the first time, they are holding U.S. crude too.
Trafigura Group Pte. is using Milford Haven, which can hold about 9 million barrels of crude and refined products in its 54 tanks, as a back-stop in a supply chain stretching about 8,000 kms from the oil ports of Texas to the refineries in north-west Europe, including the Rotterdam trading hub.
Since Washington lifted a 40-year-old ban on U.S. crude overseas sales in late 2015, Trafigura has been sending tankers across the Atlantic. Its recent pace of two to three 700,000-barrel-capacity Aframax tankers a month makes the trader one of the top exporters alongside BP Plc.
“It’s a growing business for Trafigura,” Ben Luckock, the company’s global head of crude-oil trading, said in an interview at the terminal in southwest Wales. “We are in further discussions with a number of refiners for more U.S. crude.”

Atlantic Crossing
The Advantage Avenue was the latest Aframax to make the Atlantic crossing, arriving in Milford Haven on July 8 with about 750,000 barrels of Eagle Ford shale oil loaded in Corpus Christi, Texas.
Its journey is only possible because the shale boom reversed decades of decline in American oil output. The U.S. imposed a ban on most crude exports after the 1973 to 1974 oil embargo by Arab members of the OPEC Countries stoked fears about the nation’s growing dependence on imports. Those concerns have eased as a new generation of drillers used hydraulic fracturing to blast apart shale rocks, lifting the nation’s output to a 30-year high in June 2015.
Although output has dropped 12% in the past year as the industry was hit by the global price slump, U.S. exports rose to a record 660,000 barrels a day in May. Crude is flowing into Canada, China, Curacao, France, the Netherlands and the U.K., according to data from U.S. Census and the Energy Information Administration.