Gasolinas

GeopoliticOIL Special Report: Gasoline Cargo Movements Shed Light on Mexican Fuel Shortage

A Wall Street Journal report on Friday titled “Mexico Reduces U.S. Gasoline Imports” included granular data provided by ClipperData.

As of Thursday, the day before the report was published, Mexico had only imported 253,000 bpd from the US Gulf Coast so far in January. This was 45 percent below January 2018’s pace of 457,000 bpd, and over 30 percent below last month’s pace. This is important because the US is overwhelmingly the largest supplier of gasoline to Mexico, accounting for around 80 percent of total deliveries last year. Ongoing congestion at the two key gasoline-importing ports in Mexico helps explain the lower volume of deliveries.

In the US, ClipperData receives bills of lading from the US Customs and Border Protection agency in near real-time. We have been receiving export bills since 2014, and import bills going all the way back to 2009.

Outside the US, ClipperData relies on agent reports and local sources to build our hard-data overlay.

This drop in imports comes amid fuel shortages in Mexico as new Mexican President Andres Manuel Lopez Obrador, known as AMLO, introduces policies to combat widespread fuel theft in the country.

The president’s strategy includes new fuel distribution plans and increased security surrounding energy infrastructure.

Both AMLO and Pemex have said there is enough fuel, blaming the new distribution channels for the shortages. Pemex has turned to trucks as the distribution method of choice for fuels as it abandons pipelines in the central states of Mexico in an effort to reduce illegal siphoning. This, however, has only slowed the distribution process, given that pipelines move products faster than trucks. AMLO’s new plan also includes the Port Congestion Tuxpan and Veracruz 1/14/19 deployment of 4,000 soldiers at refineries, pumping stations, storage facilities and energy infrastructure across Mexico in order to monitor fuel distribution operations.

AMLO has said his new distribution plan has been efficient at reducing pipeline siphoning and theft from trucks, while also saving the government roughly $130 million so far. The new administration is just realizing the depth and complexity of the illegal fuel market, but AMLO remains persistent in the face of fuel transit delays, pressure from the opposition and media criticism.

In the last few days, an agreement has been reached to allow private trucks to carry fuel in an effort to speed up the distribution processes. We still, however, are seeing port congestion at Veracruz and Tuxpan as vessels wait to offload their cargo.

Source: ClipperData / Pemex

AMLO has responded to the Wall Street Journal story, saying “It’s not true” and suggested the newspaper was not reliable.

While Mexican imports of gasoline from the US Gulf Coast may have picked up in the last few days, they still remain below typical levels. As a result, Mexican gasoline imports should be impacted by below-normal loadings we've seen from the region so far this month.

Mexico’s domestic market not only relies on imported gasoline, but also on middle distillates. As of Sunday, total Mexican imports of gasoline and middle distillates are at 340,000 bpd and 238,000 bpd respectively, both lower than last year’s average. In 2018, gasoline and middle distillates imports combined for an average of 785,000 bpd, so far for January the number is 579,000 bpd. These imports are broken down into more specific products, information for which we have data.

ClipperData offers reporting and analysis based on market insights, price assessments and cargo movements.

For more information, or to subscribe to GeopoliticOIL, please contact marketing@ClipperData.com