(China, July 3) The United States has officially lifted restrictions on ethane exports to China, which is seen as a positive sign for the stabilization of US-China trade relations.
According to Reuters, on Wednesday (July 2), the US government sent letters to energy companies Enterprise Products Partners and Energy Transfer, notifying them of the removal of restrictions related to ethane exports to China.
From late May to early June this year, the US government imposed restrictions on several exports to China, including ethane, citing China's restrictions on rare earth exports. It wasn’t until June 25 that the US Department of Commerce adjusted its policy, allowing the relevant companies to load ethane onto ships bound for China, but they were not authorized to unload in China without approval.
Shipping data platform Kpler showed that, affected by export restrictions, US ethane exports to China completely halted in June, with export volumes plunging from a daily average of 257,000 barrels in May. During June, at least eight ships carrying ethane were stranded at ports along the US Gulf Coast, and another ship which usually shuttled between the US and China was rerouted to India to look for alternative markets.
Currently, about half of US ethane exports are destined for China. Ethane, a byproduct refined from shale gas, is primarily used in the petrochemical industry and is a low-cost raw material commonly used by Chinese chemical enterprises. The export interruption not only dealt a blow to US producers but also affected downstream Chinese manufacturers reliant on ethane.
Compared to naphtha, Chinese companies prefer to use ethane because of its price advantage. At the same time, the US oil and gas industry also heavily relies on the Chinese market to digest the surplus supply of natural gas liquids.
On Thursday (June 26), US Commerce Secretary Luttig announced that the US and China had reached a final consensus on a trade agreement concluded in Geneva last month. As long as China exports rare earths to the US, the US will lift its retaliatory trade measures against China.
According to Reuters, on Wednesday (July 2), the US government sent letters to energy companies Enterprise Products Partners and Energy Transfer, notifying them of the removal of restrictions related to ethane exports to China.
From late May to early June this year, the US government imposed restrictions on several exports to China, including ethane, citing China's restrictions on rare earth exports. It wasn’t until June 25 that the US Department of Commerce adjusted its policy, allowing the relevant companies to load ethane onto ships bound for China, but they were not authorized to unload in China without approval.
Shipping data platform Kpler showed that, affected by export restrictions, US ethane exports to China completely halted in June, with export volumes plunging from a daily average of 257,000 barrels in May. During June, at least eight ships carrying ethane were stranded at ports along the US Gulf Coast, and another ship which usually shuttled between the US and China was rerouted to India to look for alternative markets.
Currently, about half of US ethane exports are destined for China. Ethane, a byproduct refined from shale gas, is primarily used in the petrochemical industry and is a low-cost raw material commonly used by Chinese chemical enterprises. The export interruption not only dealt a blow to US producers but also affected downstream Chinese manufacturers reliant on ethane.
Compared to naphtha, Chinese companies prefer to use ethane because of its price advantage. At the same time, the US oil and gas industry also heavily relies on the Chinese market to digest the surplus supply of natural gas liquids.
On Thursday (June 26), US Commerce Secretary Luttig announced that the US and China had reached a final consensus on a trade agreement concluded in Geneva last month. As long as China exports rare earths to the US, the US will lift its retaliatory trade measures against China.