Daily Energy Report
China imports Canadian crude, Argentina shale growth, US LNG expansion, UAE invests in US energy, EU needs Russia gas, US audits energy grants, UK state-owned power, Taiwan power squeeze, and more.
May 16, 2025
Chart of the Day
EOA: As Predicted, China Buys Canadian Crude to Replace Imports from Venezuela
Reuters: With US Trade War, China Now Top Buyer of Canadian Crude on Trans Mountain Pipeline
Summary
China has become the largest buyer of Canadian oil transported through the expanded Trans Mountain pipeline, which tripled its capacity to 890 kb/d. Trade tensions between the US and Canada, along with US sanctions on countries like Russia and Venezuela, have driven China's increased interest. Since TMX's expansion, China has imported around 207 kb/d up from 7 kb/d. US imports from TMX averaged 173 kb/d. Other buyers include South Korea, Japan, and India.
EOA’s Main Takeaway
After President Trump imposed tariffs on countries importing Venezuelan crude beginning April 2, Chinese and Indian oil companies ceased imports. We were the first to note that crude quality—not quantity—was key, and that China would compete with the US West Coast for Canadian crude coming through the Trans Mountain pipeline. We predicted Chinese firms would drive up prices, tightening price differentials. These predictions proved accurate to the letter!
We do not expect this trend to continue. China is developing a framework to import Venezuelan oil, circumventing sanctions and tariffs.
Story of the Day
EOA: Growth in Argentina’s Shale Oil to Compensate for Lack of Growth in the US