Argentina's Vaca Muerta crude expands into Asian markets as US demand declines

Crude oil produced at Argentina's Vaca Muerta shale formation is reaching new markets in China and Southeast Asia as exports diversify away from the United States, supported by higher export capacity and changing global energy trade patterns, Clarín reported.

According to data from Norwegian consultancy Rystad Energy cited by the newspaper, the Asia-Pacific region accounted for more than half of Argentina's monthly Medanito crude shipments during the first half of 2026, compared with a marginal share in 2025.

China emerged as a major buyer of the light crude for its refineries and petrochemical industry, while India, Thailand, Vietnam, Singapore and Malaysia also became regular destinations after playing only a limited role in Argentina's export market the previous year.

The shift was driven by several factors, including the conflict involving the United States and Iran, the temporary disruption of shipping through the Strait of Hormuz, improvements to Argentina's export infrastructure and the closure of US refineries that previously processed this type of crude.

The expansion in exports contributed to Argentina posting an energy trade surplus of about $6.98bn during the first half of 2026, an increase of 87% from a year earlier and the highest figure ever recorded for the period, according to a report by the Rosario Board of Trade cited in the article.

Fuel and energy exports rose 52% year-on-year to $8.12bn, representing more than 15% of the country's total exports, their highest share in two decades.

The report said 79% of that increase was explained by higher export volumes, while only 21% resulted from stronger international prices, indicating that production growth rather than price movements was the main driver.

The Rosario Board of Trade projected energy exports could exceed $14.4bn by the end of 2026, generating a sector surplus of around $12bn.

Infrastructure expansion is expected to support further export growth. The Vaca Muerta Oil Sur (VMOS) pipeline, linking Neuquén with Punta Colorada in Río Negro province, is scheduled to begin operations by the end of 2026 with an initial additional transport capacity of 190,000 barrels per day (bpd), eventually rising to between 550,000 and 700,000 bpd. 

Ernesto Díaz, vice-president for Latin America at Rystad Energy, said international buyers are increasingly prioritising energy security and supply diversification alongside price.

He added that, with the completion of VMOS and the Punta Colorada terminal, Argentina could develop exportable crude volumes exceeding 1mn bpd by 2035, transforming Vaca Muerta into what he described as "a case of strategic integration into the global energy trade."