Mexico’s Production: Taking a Hit Below the Border

The steady decline of Mexico’s crude oil production not only poses threats to the nation’s GDP, but also to the health of the tanker market in the Caribbean basin. Mexican crude oil exports have fallen by a striking 1 million barrels per day (mbpd) since 2004 with total production rates now hovering around 2.5 million barrels per day. Now however, with support from President Enrique Pena Nieto, private investors may have the opportunity to reverse the country’s crude oil fate. While Mexican exports have primarily supported the Aframax trade in the Gulf of Mexico and the Caribbean, increasing relationships between China and Mexico should shift tonnage demand from Aframaxes to larger tankers over time. Download here