Most U.S. petroleum coke is exported

In-brief analysis

November 14, 2024

Annual production of U.S. petroleum coke (petcoke) has remained relatively unchanged over the past 10 years (2014-23), averaging 46 million tons according to our analysis of U.S. Census Bureau data. Most U.S. petroleum coke is exported. The United States exported approximately 41 million tons in 2023, slightly more than the 10-year average for total petcoke exports of 40 million tons.

Petcoke is a carbon-rich fuel and feedstock extracted from petroleum during the refining process. It is a byproduct of coker units found at complex refineries. Petcoke is a steady energy source used for power generation and industrial applications. It can also be heated in a rotary kiln (calcined) to lower the concentration of sulfur and metal, resulting in high-grade anode petcoke. This feedstock, valued for its high electrical conductivity, is used by the smelting industry to produce aluminum and steel.

Unlike most other fuels, production of petcoke is not solely influenced by customer demand. Rather, the yield is correlated with refinery operations, especially the heaviness of the crude oil being refined. The heavier the crude oil, the more petcoke can be derived from the refining process. Refiners will operate a coking unit to squeeze out more high-value products such as gasoline and diesel. Because of its high-carbon content, as well as its relatively inexpensive cost of production and low risk of combustion during transport, fuel-grade petcoke is an efficient and cost-effective thermal input. At the same time, its high carbon and sulfur content can make it subject to environmental regulations in some markets.

Most U.S. petcoke is exported
Most U.S. petcoke is produced along the Gulf Coast and in the upper Midwest at refineries that operate coking units. The refineries have access to both the Gulf of Mexico and Great Lakes, which is important because most sales are made to customers overseas, who value the high heat content and low price of petcoke. Although petcoke is similar to coal in many ways, its higher carbon and sulfur content require it to be used almost solely as fuel at plants that can accommodate more impurities. As a result, petcoke typically sells at a 15% to 20% discount to the price of thermal coal.

Annual exports of U.S.-sourced fuel-grade petcoke, which constitute approximately 90% of total petcoke exports, have been remarkably steady since 2014 at 37 million tons. Fuel-grade petcoke is used mainly as a fuel at cement plants and power plants. The product serves a wide range of markets, with countries in Asia and Europe taking the most. India is an especially large destination for U.S. petcoke to meet the energy needs of cement kilns and other industrial processes. Other key destinations include countries in Central America and South America.

U.S. power generators' consumption of petcoke has been in steady decline over the past 10 years, falling by more than half from 4.4 million tons in 2014 to 1.8 million tons in 2023. Even though most petcoke was being consumed at U.S. plants that had the requisite equipment to control carbon emissions, demand fell at those plants due to greater competition from natural gas and renewable energy sources. The decline in demand mirrored the fall in coal use over the same 10-year period.

Principal contributors: Jonathan Church, Mark Morey

Tags: exports/imports, liquid fuels, petroleum coke, oil/petroleum, production/supply

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