Rocketing tanker freight rates send Mexico's fuel costs soaring

 High rates worldwide for moving oil are driving up Mexico's fuel costs as importers face tanker fees on North America's busiest maritime route that are more than double levels seen in recent years, traders and shippers said.

A reshuffling of global oil flows in the aftermath of Russia's invasion of Ukraine and high marine fuel prices have boosted transportation costs for most fuel shipments.

On routes to Mexico, the extra costs have added price volatility to an otherwise stable freight market, according to Refinitiv Eikon data and people familiar with the matter.

The rates are the latest blow to state oil company Petroleos Mexicanos (PEMX.UL), which controls the bulk of fuel imports later sold at subsidized retail prices. They are also hitting private importers bringing cargoes from the United States and elsewhere, many of whom complain of a tilted playing field.

Mexico is Latin America's largest fuel importer and the world's fourth-biggest buyer of gasoline. Over a half-dozen loaded fuel tankers crisscross the Gulf of Mexico each day.

Other busy fuel transportation routes including Middle East-Europe and Singapore-China are also seeing high volatility since March, the Eikon data showed. But those rates have not surpassed the peaks of 2020, when high demand for floating storage left the market with few available tankers.

"We are paying $50,000 per day for tankers coming from the U.S. Gulf Coast," a Mexico-based shipper said. "Mexico's ports do not accommodate larger tankers, which would cut costs, storage is limited, and we compete with Pemex's lump-sum contracts," the person said.

Under a lump-sum contract, a tanker is chartered for a one-way voyage independent of cargo size. Demurrage fees for late delivery are not paid if a trip takes longer, but loading and discharging expenses are levied on the charterer.

U.S. fuel exports to Mexico rose slightly in the first five months of this year to 1.2 million barrels per day (bpd) from 1.12 million bpd in the same period of 2021, reflecting post-COVID demand recovery and insufficient domestic output.

The country has struggled to make room for this 7% fuel import increase as Pemex deals with a limited tanker fleet and insufficient pipeline and storage capacity, leading to port bottlenecks. The congestion also contributes to higher freight tariffs when chartering contracts are renewed.

President Andres Manuel Lopez Obrador's administration hopes that building a new refinery will reduce the country's imports and make it more fuel self-sufficient, but Mexico's purchases have not receded.

As of Aug. 3, more than 40 tankers were waiting to discharge in Mexico, almost half of them over a week, according to Eikon data. The waiting times are longer at Pacific coast ports, where infrastructure limitations are greater. Tankers carrying gasoline from China, Singapore and the United Arab Emirates have added to the backup.

The vessel bottleneck is smaller than in 2020, when imports planned by Pemex trading unit PMI clashed with plummeting fuel demand amid COVID-related lockdown measures. But the congestion is slowly rising, the data showed.

On top of that, Lopez Obrador has prioritized Pemex imports over permits to private distributors, a practice denounced by some energy firms, leaving the bulk of purchases to PMI.

After paying the high freight rates, Pemex sells the imported fuel at subsidized retail prices that have contributed to heavy losses in past years. This year, though, the company is on track to turn a full-year profit.

مواضيع مرتبطة
التعليقات
or

For faster login or register use your social account.

Connect with Facebook