Mexico’s state-owned oil company, Pemex, reported a 44% drop in crude oil exports last month, averaging around 530,000 barrels per day. This marks the lowest export level in decades, according to Reuters.
In comparison, Pemex’s average daily export rate last year was around 811,000 barrels. January’s exports were the lowest since 1990. Exports to the Americas fell by 36% to approximately 321,000 barrels per day. The United States, Pemex’s largest market in the Americas, has seen a decline in imports of Mexican crude, partly due to high water content, as reported by Bloomberg earlier this month.
This drop in exports is concerning, particularly because Mexico is the second-largest supplier of crude to Gulf Coast refiners after Canada. Pemex’s financial struggles may be contributing to the issue, with the company reportedly facing over $20 billion in outstanding bills to suppliers of chemicals and equipment that are needed to reduce the water content in its crude oil. Pemex CEO Victor Rodriguez has acknowledged the problem, calling it temporary and due to excessive salt content in the oil.
Despite these challenges, Pemex remains committed to increasing its oil and gas production. The company plans to expand its reserves by focusing more on deepwater exploration. This strategy comes after years of declining production, despite various government efforts to reverse the trend. Pemex attributes the decline mainly to the depletion of mature fields and underwhelming new discoveries.
In January, Pemex’s crude oil and condensates production averaged 1.62 million barrels per day, which was 12% lower than in January 2023. On a positive note, gasoline production rose by 23%.
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