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
deployment of 4,000 soldiers at refineries, Port Congestion Tuxpan and Veracruz 1/14/19
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.

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
Source: ClipperData / Pemex 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.

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