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OIL: Asian Refiners May Seek More Mexican/Canadian Crude

OIL
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South Korean and Japanese refiners are willing to procure significantly more Mexican and Canadian crude should producers seek to diversify their sales outlets in light of US tariffs threats, Platts reports.  

  • Potential US tariffs on Mexico and Canada next month could disrupt crude trade flows within North American markets.
  • Mexican and Canadian crude suppliers could turn to Asian outlets as a remedy, according to refinery sources cited by Platts.
  • South Korean refiners are willing to consider significantly raising Mexican and Canadian crude procurement, Platts reports. South Korean refiners collectively bought 26.5m bbl of crude from Pemex last year.
  • Meanwhile, Japanese refiners are seeking to diversify their supply sources. Japan sourced 95% of its crude imports from the Middle East in 2024.
  • "As a trading firm, when [Asian side] demand is ripe and [Canadian and Mexican] supply is plentiful, we can play a significant role in the middle," an analyst at a Japanese trading house said.
  • The Maya OSP differential for February stood at a $7.6/bbl discount against the Arab Heavy OSP differential for the same loading month indicating that Asian refiners equipped with advanced crackers could yield strong margins by processing Mexican crude.  
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South Korean and Japanese refiners are willing to procure significantly more Mexican and Canadian crude should producers seek to diversify their sales outlets in light of US tariffs threats, Platts reports.  

  • Potential US tariffs on Mexico and Canada next month could disrupt crude trade flows within North American markets.
  • Mexican and Canadian crude suppliers could turn to Asian outlets as a remedy, according to refinery sources cited by Platts.
  • South Korean refiners are willing to consider significantly raising Mexican and Canadian crude procurement, Platts reports. South Korean refiners collectively bought 26.5m bbl of crude from Pemex last year.
  • Meanwhile, Japanese refiners are seeking to diversify their supply sources. Japan sourced 95% of its crude imports from the Middle East in 2024.
  • "As a trading firm, when [Asian side] demand is ripe and [Canadian and Mexican] supply is plentiful, we can play a significant role in the middle," an analyst at a Japanese trading house said.
  • The Maya OSP differential for February stood at a $7.6/bbl discount against the Arab Heavy OSP differential for the same loading month indicating that Asian refiners equipped with advanced crackers could yield strong margins by processing Mexican crude.