According to a report from the Wall Street Journal, for the first time, Petroleos Mexicanos is negotiating to sell its extra-light Olmeca crude oil in Europe, according to Pemex officials. The first shipment will go out in the second half of February to the Cressier refinery in Switzerland, the company said.
The change is one of many in the North American energy landscape affecting Pemex, which also faces competition in exploration and production as Mexico prepares to allow foreign oil companies back into the country for the first time in 75 years.
"The dramatic changes in the energy industries in the U.S. and Canada have led to an increased supply of light and extra-light crudes," said José Manuel Carrera, chief executive of Pemex's international trading arm, PMI. "We will continue to be present in the U.S., but we're also looking for new markets where [our oil] could be well received."
The U.S. gets around 78% of Pemex's crude exports, and it has taken most of the Olmeca exported since 1989. Extra-light crude accounted for around 12% of Pemex's 2.52 million barrels a day of production in 2013, and for just over 8% of its 1.19 million barrels a day in exports.
But the growing supply of light oil from south Texas means that refiners along the U.S. Gulf Coast are turning away from importing similar types of crude from Mexico and West Africa.
The U.S. Gulf Coast is a natural market for Pemex's heavy crude, because a number of refineries are configured to handle it and Pemex has a refinery there in a joint venture with Shell Oil Co. Mexico is the third-largest foreign supplier of crude to the U.S. after Saudi Arabia and Canada, and Pemex expects the U.S. to remain its main market for heavy crude for the next decade.
But U.S. purchases of Mexican crude have decreased sharply in recent years as U.S. output has risen and overall imports have dropped. Meanwhile, Mexico's production remains stagnant and its exports have declined. From a peak of nearly 1.8 million barrels a day in February 2006, the U.S. imported just 881,000 barrels a day from Mexico in the four weeks through Jan. 10, according to the Energy Information Administration.
