In July, Saudi oil imports to the United States fell to zero. Washington recorded no shipments from the kingdom for an entire month for the first time since 1985.
This historic bottom was a direct consequence of the US–Iran conflict, which effectively crippled shipments from the Persian Gulf. At the start of the year, American refineries were regularly buying more than 800,000 barrels a day from Riyadh. Now, with the Strait of Hormuz closed, prices for Middle Eastern crude have soared, forcing refiners to urgently rework their logistics.
US companies are rapidly abandoning the risky route. Phillips 66 CEO Mark Lashier said the company has cut the share of Middle Eastern crude in its refining slate to a token 1%, replacing it with lighter grades from domestic fields. Other traditional buyers of Arab barrels — Chevron and PBF Energy — have found themselves in a similar situation. Market irony even struck Motiva Enterprises, the largest refinery in the US state of Texas: the plant is wholly owned by a Saudi state company, yet it is cut off from supplies from its parent in the current reality.
The main beneficiary of the Middle East crisis has unexpectedly been Venezuela. Taking advantage of the supply vacuum, Caracas boosted shipments to US refineries to 600,000 barrels per day in July, whereas at the start of the year that figure barely reached 100,000 barrels.