Reviewing Mexican crude oil trade flows and their impact with Kpler data

This week we will take a look at the impacts of recent Mexican crude oil trade flows on trade partners such as the United States and others using Kpler’s real-time data. 

Mexico’s presidential election is months behind and some recent observable trends are going to dampen expectations that Claudia Shinebaum for Mexico to become energy independent. Mexico has typically exported crude oil and imported motor fuels which Kpler’s data below highlights. What is notable in the last month, is that Mexico’s largest crude buyer, the United States, imported the lowest total across Kpler’s historical data going back to 2013, at a low of 341 kbd. This can be observed in the screenshot of Kpler’s data below. 

Refiners in the U.S. Gulf Coast are going to feel the drop in exports, which is due to declining Mexican crude production. Kpler tracks not only commodity cargo, but also country level supply & demand for crude oil, refined products and more. Here we can also observe this with Kpler’s data. 

From a high of over 1.9mbd in production in May 2023, the steady decline in production can be viewed in the screenshot below. Kpler provides nowcasts, but also forecasts, with its supply & demand models and here we can observe that Kpler is forecasting the decline to continue. This will create some changes within the U.S. Gulf Coast importers. 

This decline in production is expected to happen regardless of what happens with refinery runs. Here, Kpler is also able to reveal the other side of the supply & demand equation. The Dos Bocas refinery has been under some scrutiny as it prepares to open, as it has several times delayed its opening and still is under preparations to open. Regardless, Mexico’s refinery run intake has been driven up this year, observed in Kpler’s supply & demand data below.

Kpler also provides a wealth of historical data even with its models, and when looking into recent seasonality in Mexican refinery runs, 2024 is standing out as a significantly higher year than those before it.

What can also be observed during this trend of high refinery runs, is that Mexico began to import less gasoline than it had in previous years, during those same months. This can be observed in the data below, which shows that beginning in January 2024, the moving average for Gasoline and Naphtha imports to Mexico took a steep drop. Kpler also provides data on the granular grade level detail of cargo imports and exports, and here we can also observe the types of imports that Mexican buyers received. 

Due to some refinery events such as fires (observable through Kpler data as well), the runs took a back step (observable in the previous refinery run data) which then triggered a need for Mexico to import motor fuel such as gasoline more than they had all year. This type of interconnected market dynamic is something for which Kpler provides real time insight, enabling market players to stay a step ahead. 

On the United States side of this trading relationship, buyers have had to find some alternative sources of crude. When looking into recent imports in PADD 3, it can be seen that Venezuela is actually filling a decent sized share of the crude import pie. Between June 2024 and July 2024, the United States imported 228kbd and 253kbd respectively. This now represents the second largest exporter to PADD 3, outside of Mexico in July.

These changes in supply & demand within the Americas will have large impacts in the coming years on the shape of the crude and refined product market. Trust Kpler to help you navigate these markets with real time data, models, forecasts and expert research to ensure that you never miss an opportunity.