Mexican liquids production fell m/m by 54 thousand b/d to 1.93 mb/d in November, lower y/y by 0.18 mb/d, hitting its lowest since 1995. Crude output plunged to a record low of 1.72 mb/d (-0.15 mb/d y/y) led by a 29 thousand b/d m/m decline for light crude, with combined light and super light output down y/y by 0.15 mb/d. Output was constrained by flooding at the Xanab light crude field and maintenance at the Ku field. Pemex forecasts that crude production will continue declining through March before picking up from May to hit 1.85 mb/d by December 2019.
Crude exports rose m/m by 0.11 mb/d to 1.14 mb/d in November, but this was lower y/y by a massive 0.25 mb/d. The m/m uplift came amid low refinery runs and as ports cleared cargoes that had been delayed by October’s hurricane-related closures. Shipments to the Far East were up by 0.19 mb/d m/m, while exports to the Americas were down 92 thousand b/d m/m. Even though Mexico reduced the K factor for Maya in December, it was still unseasonably strong (+$3.45 premium), keeping it uncompetitive on the USGC. The January K factor was more competitive. Refinery runs remained low in November, at 0.52 mb/d, up just slightly from October’s 0.49 mb/d. December crude exports decreased m/m by 25 thousand b/d to 1.13 mb/d, based on Kpler cargo-tracking data, suggesting runs remain paltry. Oil demand fell by 98 thousand mb/d y/y to 1.62 mb/d, led by fuel oil (-64 thousand b/d y/y) and gasoline (-76 thousand b/d y/y). However, diesel demand increased y/y by 38 thousand b/d, adjusted for third-party sales based on preliminary figures. LPG demand fell y/y by 2 thousand b/d to 0.25 mb/d, also adjusted for third-party sales based on preliminary figures.