A potential trade war between the United States and China is set to reduce U.S. crude oil exports in 2025 for the first time since the COVID-19 pandemic, analysts warn. The decline would mark a significant shift in U.S. oil trade, driven largely by tariffs that could limit access to the Chinese market.
Despite the U.S. government’s efforts to boost record high oil and gas production, retaliatory tariffs from China are expected to cut U.S. crude exports from 3.8 million barrels per day (bpd) in 2024 to 3.6 million bpd in 2025, according to Rohit Rathod, a senior analyst at ship tracking firm Vortexa.
China, which consumes approximately 166,000 barrels of U.S. crude daily—about 5% of total U.S. exports—has imposed tariffs that will primarily affect medium-sour crude grades such as Mars and Southern Green Canyon. These grades made up nearly half of China’s U.S. crude imports in 2024.
While these grades may lose favor in China, U.S. refiners in the Gulf Coast are well-positioned to absorb the supply, analysts suggest. “Medium-sour barrels are welcome in the U.S. Gulf Coast. Refiners need it,” said Rathod.
Lighter, sweeter grades such as West Texas Intermediate (WTI) are less likely to be affected. Analysts predict these grades will be diverted to European and Indian refineries at competitive prices. The Louisiana Offshore Oil Port, which handled nearly half of all U.S. exports to China in 2024, is expected to see minimal disruption.
While U.S. producers will feel some pressure, the broader impact on China is expected to be limited. U.S. crude accounted for just 1.7% of China’s total imports in 2024, down from 2.5% in 2023. China has diversified its crude sources, increasing imports from Canada by 30% and taking advantage of discounted Russian and Iranian oil.
Enbridge’s Ingleside facility near Corpus Christi, which contributed 25% of U.S. exports to China last year, is also unlikely to face significant fallout. “The light sweet market is so wide and liquid, we don’t see it having a major impact on exports,” said a source familiar with Enbridge operations.
Occidental Petroleum, a key player in U.S. crude sales to China, declined to comment on the potential impact.
The ongoing trade tensions highlight the complexities of global oil markets and the potential for geopolitical disputes to affect energy trade flows. If the tariffs persist, the U.S. may need to pivot further to alternative markets while strengthening its domestic refining capabilities. Meanwhile, China’s growing reliance on other oil-producing nations could signal a long-term shift in its energy strategy.
