Mexican state oil company Pemex is reversing crude exports cuts of at least 330,000 barrels per day (bpd) planned for May amid a smaller-than-expected oil demand by the company’s domestic refineries, two sources close to the decision said on Friday.
Pemex’s international trading unit in April began enforcing exports cuts over supply crude contracts to customers in the United States, Asia and Europe to increase its availability of crude for domestic refining.
Its new Olmeca Refinery in the port of Dos Bocas in southeastern Tabasco, which has been running behind schedule and over budget, is also expected to start up.
Earlier on Friday, Pemex executives said that the refinery would start producing diesel next month.
But planned maintenance at some refineries and a slower-than-expected startup at Dos Bocas will reduce the need for domestic crude in May, the two sources and an additional person with knowledge of the company’s operations said.
Pemex did not immediately respond to a request for comment.
Recent fires at two Pemex refineries did not impact crude processing at those plants because they happened at unrelated infrastructure, the sources said, adding that the company’s overall demand for domestic oil is expected to fall next month.
Traders expect Pemex and its trading unit to use contract provisions in supply contracts this year, allowing them to allocate the exports volumes on a monthly basis.
This will give them room to adjust volumes available for exports according to domestic refining needs.
(Reporting by Marianna Parraga in Houston and Stefanie Escenbacher in Mexico City; Additional reporting by Ana Isabel Martinez in Mexico City; Editing by Leslie Adler and Diane Craft)