Guyana's Oil Boom Grabs Bigger Share of European Market

(File photo: Hess Corp)
(File photo: Hess Corp)

Guyana has gained a larger share of Europe's oil market this year, vessel monitoring data showed, driven by rising output by a consortium led by ExxonMobil and strong demand for light sweet crude grades amid a reshuffling of global oil flows.

Western sanctions on Russian oil due to its invasion of Ukraine since last year have opened a window of opportunity for emerging producers including Guyana, whose crude grades are a good fit for many European refiners.

Guyana's crude exports to Europe in the first semester this year rose to some 215,000 barrels per day (bpd), or 63% of the country's total exports of 338,254 bpd, according to Refinitiv Eikon data. Exports to Europe had accounted for about 50% of last year's shipments.

The South American country's rising output has allowed the Exxon consortium and the government, which separately markets its share of oil output, to funnel more to European refiners. A large portion of Guyana's crudes are being traded in Rotterdam, a key European oil hub, the data showed.

Some of that increased flow to Europe, however, has also come at the expense of U.S. Gulf Coast's refiners, which have not imported Guyanese crude so far this year, the data showed.

Asia's oil imports from Guyana have been flat this year, with about 90,000 bpd passing through Panama's pipeline system. Brazil received some 22,000 bpd in the first half of the year, an increase from 18,000 bpd in 2022.

Exxon and Guyana's government did not immediately reply to requests for comment.

Guyana reported revenue from royalties and profit oil of $439 million in the second quarter, which increased the nation's oil fund balance to $1.72 billion at the end of June.

Exxon and partners U.S.-based Hess Corp and China's CNOOC are the only active oil producers in Guyana. Their projects are expected to reach 1.2 million bpd of output by 2027, turning Guyana into one of Latin America's most prominent producers, only surpassed by Brazil and Mexico.

Guyana's parliament recently approved new oil legislation designed to encourage new production and increase the country's share of oil revenues. Bids under its first competitive auction of offshore blocks are due in coming weeks. Results could be disclosed later this year.

(Reuters - Reporting by Marianna Parraga, additional reporting by Kiana Wilburg and Sabrina Valle; Editing by Marguerita Choy)

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