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Foreign Tankers Benefit From US Fuel Shipping Waivers

Bloomberg Markets •
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Commodity trader Trafigura Group and energy refiner Phillips 66 are at the forefront of utilizing US government waivers that permit the operation of foreign-flagged tankers for domestic cargo transport. These exemptions allow companies to circumvent restrictions typically imposed by the Jones Act, which mandates that goods shipped between US ports must move on US-built, owned, and crewed vessels.

The use of these foreign vessels has become crucial as the demand for moving refined products, crude oil, and other energy cargoes within the United States continues to strain the capacity of the existing US-flagged fleet. Securing these waivers provides a competitive advantage in logistics and supply chain flexibility for the recipients.

These approvals are granted by the Maritime Administration (MARAD), which assesses applications based on the unavailability of suitable US-flagged tonnage for specific routes or cargo types. The prominence of Trafigura and Phillips 66 in receiving these authorizations suggests their active role in managing significant domestic fuel distribution needs, potentially involving shuttle services or specialized product movements.

While the exact volume of cargo moved under these specific waivers is not detailed, the granting of these exceptions points to ongoing supply chain pinch points within the domestic waterborne transportation sector.