Industry Trend Analysis - Scenario Analysis: What Would Trump Energy Policy Mean For Asian Importers? - APR 2017


While not our core view, should Trump's pro-energy policies drive a meaningful upsurge in US crude and LNG exports in the coming years, major energy importers in the Asia-Pacific will benefit from greater opportunities for arbitrage and supply diversification.

  • Should Trump's policies - through a mix of fiscal and regulatory relaxations - support higher crude oil and gas output in the US, it could push down US prices and increase outflows of these commodities towards APAC.

  • A rise in US crude exports will benefit China, South Korea and Japan, which will help to cushion the loss in certain OPEC barrels in the short-term, and ease reliance on Middle Eastern crudes in the long-term.

US Crude Flows Have Further To Rise
US Crude Oil Tanker Flows To Asia, DWT
Source: Bloomberg, BMI
  • Higher gas production would support lower US hub prices and LNG export prices. This will benefit Asia, where we see net LNG imports averaging yearly growth of 6.3% to 2021.

  • India, Pakistan and Bangladesh have few LNG supply deals in place compared to their projected LNG imports growth over the coming years. US cargoes could help fill some of this gap.

US LNG Could Gain Market Share In Asia EMs
Asia-Pacific - LNG Net Export Forecast, bcm
Negative implies imports. f = BMI forecast. Source: National Sources, EIA, BMI.