February 15, 2017 [OPIS] - Brazil's 2017 imports of diesel and gasoline got off to a strong start in January, with imports of both transportation fuels hitting their highest levels since July 2016, figures from Brazil's Secretariat of Foreign Commerce (Secex) show.
Brazil in January imported 5.24 million bbl of diesel, marking the first time since July 2016 that monthly imports topped 5 million bbl.
Brazil in January also imported 2.04 million bbl of gasoline, marking the first time since July 2016 that monthly imports topped 2 million bbl.
Brazil’s monthly fuel imports in 2016 averaged 4.15 million bbl in the case of diesel and 1.53 million bbl in the case of gasoline.
Several factors contributed to a drop in Brazil’s diesel imports in both 2015 and the first half of 2016, including a significant drop in demand due to the country’s sagging economy and the startup of the Abreu e Lima (RNEST) refinery in the northeastern state of Pernambuco. The refinery, which belongs to Brazil’s state-controlled Petrobras, made its debut among monthly government statistics in December 2014.
The RNEST refinery ended 2016 on something of a high note as far as diesel output is concerned, producing 1.52 million bbl of diesel in December compared to just 867,675 bbl in November. However, the refinery’s monthly diesel output averaged 1.85 million bbl over the course of 2016. Diesel production figures for January are not yet available.
Similarly, figures pertaining to Brazil’s implied demand for diesel and gasoline are a bit dated when looking at statistics from Brazil’s National Oil, Gas and Biofuels Agency (ANP), which at presstime showed distributor sales volumes only through November 2016.
Over the first 11 months of 2016, distributor sales of “gasoline C” (gasoline blended with 27% ethanol) were up by 4.3% year on year, averaging 22.18 million bbl a month. Meanwhile, distributor sales of diesel were down by 5.0% year on year and averaged 28.63 million bbl a month.
As for Brazil’s domestic fuel production during full-year 2016, diesel production was down by 8.3% year on year and averaged 23.78 million bbl a month, and production of “gasoline A” (prior to blending with ethanol) was up by 3.1% year on year, averaging 13.90 million bbl a month.
It’s worth noting that one development that could potentially cut into Brazil’s imports of petroleum diesel going forward is Brazil’s rising biodiesel blend rate, which is set to rise from a minimum mandatory level of 7% currently to 8% in March 2017, 9% in 2018 and 10% in 2019.
