Canada Fires May Have Prompted Rare U.S. Import of Danish Oilby
Shipment of light, sweet crude arrived in Louisiana last week
First transport from Denmark in 12 years, EIA data show
The U.S. imported crude from Denmark last week for the first time this decade, a movement that may have been prompted by the recent Alberta wildfires.
BP delivered 630,000 barrels of light, sweet DUC crude from the Danish North Sea into Gramercy, Louisiana, on July 5, according to U.S. Customs data compiled by Bloomberg. It’s the first shipment from Denmark in more than 12 years and the first to PADD 3 in almost 20 years, based on data from the Energy Information Administration. BP officials didn’t immediately respond to an e-mail seeking comment on the cargo.
The cargo may have been intended to replace Canadian light, sweet synthetic crude that usually flows into the Midwest but was disrupted for several weeks by the fires that started in early May, Erika Coombs, senior energy analyst at BTU Analytics LLC in Lakewood, Colorado, said in an e-mail. The 1.2 million-barrel-a-day Capline pipeline extends to Midwest refineries from St. James, Louisiana.
“Gramercy is near Capline and is a very cheap way to get foreign crude into the Midcontinent,” Coombs said.
Total SA’s Lindsey plant in the U.K., which has used the grade, shut a 200,000-barrel-a-day crude unit this month, according to Genscape. The cargo’s load date on the Istanbul, a Suezmax oil tanker, was June 15, a few weeks before the Lindsey shutdown.
“It was probably originally going into Northern Europe,” Harold “Skip” York, principal analyst at Wood Mackenzie in Houston, said in a phone interview. “Maybe there were outages at refineries in those areas and this cargo was pushed out.”
The U.S. Gulf is an attractive destination for another reason, York said. “Nowhere between Danish waters and the U.S. has better storage rates.”