U.S. waterborne crude oil imports have reached their lowest levels since March 2021, highlighting a significant shift in trade dynamics, particularly with neighboring Canada. February proved to be a pivotal month as a decline in crude shipments from Canada, coupled with ongoing refinery maintenance on the East Coast, substantially impacted overall demand. This situation has left analysts pondering the future of crude imports amid looming tariffs.

Decline in Canadian Crude Shipments

According to ship tracking data, U.S. waterborne crude oil imports fell by 319,000 barrels per day (bpd) in February, settling at 2.32 million bpd. This drop marks the lowest monthly figure in nearly four years. The decline was primarily driven by a significant reduction in Canadian crude, which plummeted to 265,000 bpd, a 33% decrease from previous levels and the lowest since April 2024.

• A staggering 67% drop in Canadian shipments to the East Coast significantly contributed to this decline.
• This downturn coincided with a major maintenance period at the largest refinery in the region, which further stifled demand.

East Coast Refinery Utilization Hits New Low

Recent data from the U.S. Energy Information Administration reveals that East Coast refinery utilization has plummeted to 54.8%, down from 82.5% just a week prior. This marks the lowest refinery activity since July 2020.

• The Bayway Refinery, operated by Phillips 66, is undergoing a crucial 50-day turnaround, which began last month and is expected to impact crude import levels significantly.
• As a result, shipments to the East Coast have dipped to a mere 354,000 bpd, the lowest in four years.

Impact of Tariffs on Trade Flows

The uncertainty surrounding potential tariffs, specifically the 10% levies on crude imports from Canada instituted by former President Donald Trump, has created additional challenges for trade flows. Traders are hesitating to secure barrels, waiting for clarity on these tariffs, which has led to a noticeable decline in Canadian imports.

• Analysts, including Hillary Stevenson from IIR Energy, suggest that as some refiners resume operations, the demand for imported crude could continue to decline.
• Notably, refiners like Chevron and Exxon Mobil have optimized their operations to process more domestic crude, further weighing down import requirements.

Rising Imports from Other Sources

Despite the overall downturn in crude imports, there was a notable increase in shipments from Brazil, which surged by approximately 58% to 292,000 bpd in February. This increase may be a strategic move to mitigate the risks associated with tariffs on Canadian barrels.

• Experts like Rohit Rathod from Vortexa anticipate that demand for crude from other regions, including the Middle East and Colombia, will likely rise as the market adapts to ongoing tariff discussions.

As the situation evolves, analysts predict that the implications of these tariffs will become clearer in the coming weeks. The landscape of U.S. crude imports is shifting, and stakeholders are closely monitoring how this will affect future supply dynamics.