Mexico Mulls Halting Crude Exports in 2023

The Latin American country remains one of the major players on the global oil market, with the Mexican company Pemex selling almost 1.9 million barrels of fuel per day to international refineries at its peak in 2004.

Mexico is considering stopping its crude oil exports in 2023, a move, which is part of President Andres Manuel Lopez Obrador’s goal to reach self-sufficiency in fuel production, Bloomberg has reported.

The news agency cited Octavio Romero, CEO of the Mexican state-owned oil producer Petroleos Mexicanos (Pemex), as saying during a press conference that the company plans to cut daily crude exports by more than half to 435,000 barrels in 2022, before phasing out sales to foreign customers the following year.

According to Bloomberg, by scrapping crude oil exports Mexico seeks to expand domestic production of gasoline and diesel on its own, something that the Latin American country now mostly imports from US refiners.

If Pemex delivers on its pledge, it will mark “the exit from international oil markets of one of its most prominent players of the past decades”, Bloomberg reported.

The news outlet recalled that at its peak in 2004, the company sold nearly 1.9 million barrels a day to global refineries, including in Japan and India, also taking part in OPEC meetings as an observer.

Some, however, remain downbeat about Mexico’s “ambitious” yet “improbable endeavour” to halt crude exports, given that the company is yet to tackle a $113 billion debt load that Bloomberg recalls is “larger than that of any other oil explorer in the world”.

Rosanety Barrios, a former Energy Ministry official under ex-Mexican President Enrique Pena Nieto, told the news network that Pemex’s pledge “seems impossible” to him because the refineries “are not capable of operating at 80%”. US refiners, in contrast, typically operate at more than 90% of capacity.

Nieto added that another hurdle could be Pemex’s plan to implement the task all by itself without studying the expertise of foreign partners “so that if something doesn’t go as expected, there is no cushion”.