US Crude Export Ban Lifted: ConocoPhillips and NuStar Energy Pave the Way for First Loadings

Strategic Insights -

ConocoPhillips and NuStar Energy have seized the opportunity presented by the removal of the U.S. crude export ban, with plans to load the first export cargo of U.S. light crude since the 1970s on Thursday. The crude, sourced from the Eagle Ford Shale Play, is being loaded at NuStar's North Beach Terminal in the port of Corpus Christi, Texas. This move allows the companies to capitalize on the shift in U.S. energy policy, which is expected to support continued drilling activity and potentially lower gasoline prices.

Key Takeaways:

  • ConocoPhillips and NuStar Energy have announced plans to load the first export cargo of U.S. light crude since the 1970s, beating Enterprise Products Partners' projected timeline.
  • The crude being exported is sourced from the Eagle Ford Shale Play and is being loaded at NuStar's North Beach Terminal in Corpus Christi, Texas.
  • The U.S. crude export ban, in place since the 1970s, was lifted on December 18, 2015, as part of the 2016 spending bill.
  • Shale producers argue that allowing crude exports will support continued drilling activity and help stabilize oil prices.
  • Economists, including those at the Energy Department, believe that lifting the ban will help the economy and potentially lower gasoline prices.
  • Baker Hughes reported that the U.S. oil rig count fell by 2 to 536 during the past week.
  • ConocoPhillips' shares edged up 0.2% to close at $46.69, while NuStar Energy's shares jumped nearly 7% and Enterprise Products rose 2.7%.

Statistics:

  • U.S. crude futures rose 1.2% to $37.04 a barrel on Thursday (December 31, 2015).
  • The U.S. ban on crude exports was lifted on December 18, 2015, as part of the 2016 spending bill.
  • Oil prices fell 30% for 2015 after diving 45% in 2014.
  • The U.S. oil rig count fell by 2 to 536 during the past week (as reported by Baker Hughes).
  • ConocoPhillips' shares closed at $46.69 on December 31, 2015.
  • NuStar Energy's shares jumped nearly 7% on December 31, 2015.

Sources:

  • Investor's Business Daily, Inc.
  • ConocoPhillips ([NYSE:COP])
  • NuStar Energy ([NYSE:NS])
  • Enterprise Products Partners ([NYSE:EPD])
  • Baker Hughes ([NYSE:BHI])
  • Energy Department
  • Twitter (@IBD_GRich)