PEMEX increases Chinese fuel imports

Mexico’s ongoing refinery crisis has paved the way for Chinese fuel to enter the energy sector

PEMEX increases Chinese fuel imports
The presence of gasoline coming from Singapore and Korea is growing more and more frequent in shipments arriving in the country - Photo: China Daily & César Gómez/REUTERS & EL UNIVERSAL
English 08/08/2018 13:35 Noé Cruz Serrano Mexico City Actualizada 13:39

The consumption of Chinese gasoline in the Mexican market has been going on since late 2017. Mexico’s ongoing refinery crisis has paved the way for Chinese fuel to enter the energy sector in irregular, though increasing, volumes.

According to the National Supply and Imports Management of Mexican Petroleums (PEMEX) Industrial Transformation (PEMEX TRI), through a report delivered to the National Transparency Platform, Chinese gasoline is not always cheaper with regard to other markets that the Mexican oil company turns to in order to cover national consumption.

Furthermore, the presence of gasoline coming from Singapore and Korea is growing more and more frequent in shipments arriving in the country. The gasoline gets mixed up with production from PEMEX refineries, as well as gasoline from other countries, including the USA.
 

Since 2016, the government denied purchasing Chinese fuel, stating that accusations spread through social networks about the purchase of low-quality gasoline coming from the Asian country were false. However, since last year, the Mexican government has found it inevitable to resort to their supply.

According to official data, shipments from 20 different countries were received in 2017: Bahamas, China, Spain, Great Britain, Korea, Malaysia, the Netherlands, Panama, Puerto Rico, Portugal, Singapore, Trinidad and Tobago, the Virgin Islands, Canada, France, Italy, the Netherlands Antilles, Japan, and Belgium.

During the first five months of 2018, only seven countries were confirmed to supply fuel as a supplement for national demand: China, the Netherlands Antilles, the Netherlands, Singapore, the United States, the Virgin Islands, and Malaysia.

Although the U.S. market has a greater presence in Mexico’s auto fuel imports, representing an 80% of total imports, according to PEMEX TRI’s operation reports from last year, gasoline purchase from the Asian Giant has grown considerably.

In June 2017, the first gasoline shipment coming from Singapore arrived in Mexico with a volume of 299,000 barrels, according to the Ministry of Economy and PEMEX TRI’s National Supply and Imports Management. In July, 310,500 barrels came in from Korea, while in August and September, two more shipments were received from Singapore, one of 301,000 barrels, and another of 598,200. In September and October, there were two more shipments of 462,000 and 126,700 barrels each, coming from Korea.

In 2018, more gasoline was purchased from China in the months of March and May, with shipments of 278,600 and 929,600 barrels each, which represented a 233% growth within just two months. Shipments from Singapore were received on April and May, with 312,000 and 300,000 barrels each.

However, in terms of price, Chinese gasoline wasn’t necessarily the cheapest purchased by PEMEX on international markets. The report showed that, during the month of May, fuel imports from China were the cheapest.
 

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