- New U.S. Commerce Department rules require export licenses for ethane shipments to China, revoking previous approvals.
- China imported a record 492,000 barrels per day of U.S. ethane in 2024, nearly half of total U.S. exports.
- The licensing requirement introduces uncertainty, risking feedstock shortages for Chinese petrochemical plants and causing market shifts.
U.S. ethane exports to China are encountering fresh obstacles due to a new mandate from the U.S. Commerce Department that requires export licenses for shipments to China, including the cancellation of previously granted licenses, reports Reuters.
This policy change threatens significant trade volumes. In 2024, China imported a record 492,000 barrels per day of U.S. ethane, which accounted for almost half of all U.S. ethane exports.
Export licenses for ethane shipments
Approximately 284,000 barrels per day are scheduled for loading in June, with tankers currently awaiting departure. The new licensing rules create uncertainty for Chinese buyers, who are now closely watching the approval process, and for U.S. exporters, such as Ineos, who may consider redirecting shipments to Europe.
Market analysts warn that if the restrictions continue, Chinese petrochemical plants could face feedstock shortages, potentially causing project delays.
Major companies, including Enterprise and Energy Transfer, are still evaluating the impact. Meanwhile, investor confidence in Chinese ethane importers has weakened, leading to declines in stock prices for firms such as Satellite Chemical and Wanhua Chemical.
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Source: Reuters
