Saudi crude oil shipments to U.S. drop to zero for first time since 1985

U.S. imports of Saudi crude oil fell to zero in July, the first full month without Saudi oil deliveries since 1985, according to preliminary government data. The decline followed disruptions to Persian Gulf oil flows tied to the U.S.-Iran conflict, forcing refiners to replace Saudi barrels with supplies from sources including Venezuela. Saudi shipments to the U.S. may rebound to about 300,000 barrels a day this month, according to Kpler forecasts, after months of trade disruptions. U.S.-bound shipments of the kingdom’s crude ground to a halt in July, according to U.S. Department of Energy data released August 5. Earlier this year, U.S. refiners were buying more than 800,000 barrels of Saudi oil a day. Phillips 66 reduced the proportion of Middle Eastern crudes flowing into its plants to less than 1%, CEO Mark Lashier said August 5. The company has been sending light crude from U.S. fields to its New Jersey refinery to replace some foreign grades. Other U.S. refiners that historically have been heavy users of Saudi oil include Chevron Corp. and PBF Energy Inc. Motiva Enterprises, which owns the nation’s largest refinery in Port Arthur, Texas, is wholly owned by the Saudi state oil company and in normal times processes Mideast oil. Venezuela has been a big winner in the pivot away from Saudi crude. American refiners imported around 600,000 barrels of the Latin American country’s crude in July, up from roughly 100,000 at the start of the year. There have been occasional weeks when Saudi deliveries to the U.S. dropped to zero but July was the first time they bottomed out for a full month in more than 40 years.