Seaborne oil trade
Oil is the fuel that keeps the global economy running. Worldwide production of crude oil rose from a little over 63 million barrels per day in 1988 to about 86.8 million barrels daily in 2013. Crude oil prices increased dramatically over this period. The spot price of West Texas Intermediate (WTI) jumped from around 14 U.S. dollars per barrel in 1988 to about 79 U.S. dollars per barrel in 2010, when there was virtually no spread between WTI and UK Brent. In 2016, the spot price of a barrel of WTI stood at about 43 U.S. dollars.
While accounting for less than 10 percent of global oil production, the Asia-Pacific region is the largest consumer of oil; over a third of worldwide oil consumption is concentrated here. Consequently, main petroleum source countries such as Venezuela are beginning to look to Asian markets in order to offset the sharp decline in oil exports to the United States. U.S. petroleum net imports plunged from 12.6 million barrels a day in 2005 to 4.87 million barrels daily in 2016.
Where pipeline infrastructure between trading partners is limited, large oil volumes have to be transported by land or sea. The key passages for seaborne oil trade include the routes from Panama to China, from the Strait of Hormuz to Japan and from West Africa to India. Globally, just under 1.9 billion metric tons of crude oil were unloaded from ships in 2012, slightly up from around 1.8 billion metric tons in 2011. At the same time, the number of metric ton-miles of oil traveled grew by almost 10 percent to reach a staggering 7.8 trillion in 2012. The increase in seaborne oil trade is expected to translate into positive revenue growth for tanker builders such as General Dynamics-owned NASSCO. In 2016, crude oil tankers were the third most important vessel type in the global merchant fleet.