Pemex wants to capitalize on Venezuela's dwindling crude production to boost its exports to US
Asked whether falling crude production in Venezuela could represent an opportunity for the Mexican oil company, Pemex top executive Carlos Trevino said this week "without a doubt it is, and without a doubt we are taking advantage of it."
Venezuela exported 438,000 b/d of crude to the US in January, or 38pc less than the previous year, data from the US' energy information agency (EIA) shows. Over the past 12 months, Venezuelan crude exports to the US have fallen by 20pc.
In the same period of time, Mexican crude exports to the US rose 3.7pc, even though August and September export levels were unusually low because of repeated earthquakes in Mexico that damaged refineries and Hurricane Harvey along the US Gulf coast that temporarily shut much refining capacity there.
In November and December, US exports of Mexican crude reached 805,000 b/d and 726,000 b/d, respectively, the highest since June 2015, EIA data shows.
The US has been mostly relying on crude imports from Canada and Iraq, which are both on the rise.
But Canadian oil companies have been faced with pipeline shortages, further exacerbated by a spill on TransCanada's Keystone pipeline in South Dakota last November. Bottlenecks have also limited oil-by-rail movements, meaning they are unlikely to significantly ramp up crude exports to the US in the immediate future.
Compared with Iraq, Mexico's heavy crude oil has the advantage of being closer to US refineries.
US Gulf coast refineries that reduced imports of Venezuelan crude last year while more than doubling consumption of Mexican grades included Valero's 293,000 b/d refinery in Corpus Christi. Chevron's 340,000 b/d refinery in Pascagoula, Mississippi, increased Mexican imports by 37pc, while Phillips 66's 247,000 b/d Sweeny, Texas, refinery took Mexican imports for the first time in at least two years.