The United States has cleared the way for ethane exports to China to resume by removing a license requirement that had paused shipments last month.
Letters sent on Wednesday to producers Enterprise Products Partners and Energy Transfer informed them that the restriction was lifted.
The license requirement had been put in place in late May and early June as part of a broader set of export limits in response to U.S. concerns that China was delaying shipments of rare earth materials. The restrictions halted ethane shipments, which had reached 257,000 barrels per day in May.
Last week, the U.S. and China resolved issues around rare earth and magnet shipments, leading to this change. The Commerce Department had already signalled a shift by notifying companies they could load ethane bound for China but could not unload it without special approval.
Following the removal of the license rule, at least eight vessels were reported heading to China on Wednesday after remaining idle along the U.S. Gulf Coast. One vessel previously changed course to India in June due to the export restrictions.
Ethane, a natural gas liquid used as a petrochemical feedstock, is cheaper than naphtha and in high demand by Chinese manufacturers. Nearly half of U.S. ethane exports go to China. The export halt had affected both U.S. suppliers and Chinese buyers.
Industry expectations are that U.S. ethane exports in July will return to the usual level of about 240,000 barrels per day. The Commerce Department and the White House did not comment on the latest move.
