An oil refinery in Pueblo Viejo, Veracruz state, Mexico. (Mauricio Palos/Bloomberg)
January 28, 2026 4:02 PM, EST
Key Takeaways:
- Mexico’s surge in refinery activity has sharply reduced its gasoline and diesel imports, weakening demand for U.S. fuel exports.
- The ramp‑up of the Dos Bocas refinery and new processing capacity at Tula are boosting Mexico’s fuel output amid already elevated U.S. gasoline and diesel inventories.
- Pemex is running its plants hard ahead of a major travel period, though recent fires highlight ongoing concerns about sustaining high operating rates.
[Stay on top of transportation news: Get TTNews in your inbox.]
A decade-high resurgence in Mexican fuelmaking threatens to weigh on U.S. refineries as demand from their largest fuel buyer fades, adding to worries about buildup of gasoline stockpiles in America.
Petroleos Mexicanos’ imports of gasoline and diesel fell to a 16-year low last year, according to company data. Imports declined as the state oil company operated its refineries at the highest rates in a decade. Meanwhile, the country’s largest refinery, Dos Bocas, is finally ramping up after several false starts since its inauguration nearly four years ago.
Mexico’s fuel revival is bad news for U.S. refiners, as the country historically purchases the most American-made motor fuels. The Latin American nation imported 726,000 barrels a day of gasoline and diesel in October, according to the latest data from the US Energy Information Administration. A drop in imports poses a problem for U.S. refineries including Valero Energy Corp., Marathon Petroleum Corp. and Exxon Mobil Corp. as gasoline inventories in the U.S. are the highest since the pandemic, while diesel stocks sit at a two-year high.
The rise in fuel production is being driven largely by the ramp-up of the Dos Bocas plant. The refinery, also known as Olmeca, operated at 77.5% of its installed capacity in December, its best performance to date, according to company data compiled by Bloomberg. Fuel output is also getting a boost from a new coker unit at Tula refinery that converts sludgy fuel oil into higher-value fuels. The coker processes residuals from both Tula and neighboring Salamanca refinery.
(Bloomberg)
Pemex is expected to keep its refineries running hard at least through the Holy Week holiday in late March and early April, the second-busiest period for road travel in Mexico after December. Still, it’s unclear whether the company can sustain high rates as equipment is prone to breakdowns when pushed too hard. Last week, fires were reported at both the Dos Bocas and the Salina Cruz refineries.
(Bloomberg)
The uptick in Mexico’s domestic refining also spells uncertainty for U.S. refiners who rely on heavy Mexican and Canadian crude oil for fuel processing, according to John Padilla, managing director at IPD Latin America, an energy consultancy.
“U.S. refiners need heavy crude, and the U.S. is rapidly losing Mexican and Canadian oil,” Padilla said. “Oil from Venezuela can’t fill the gaps as quickly as Trump would hope.”
Want more news? Listen to today’s daily briefing below or go here for more info:
