Page 4 - LatAmOil Week 22 2022

LatAmOil COMMENTARY LatAmOil

(Image: YPF)
Diesel shortages hitting

in Bolivia and Argentina

Widespread supply disruptions in northern Argentina and western Bolivia trigger high-level responses

THE disruptions that have hit world diesel mar- in April. Specifically, the news agency reported,
kets since late February, when Russia began its Par Hawaii Refining received around 1mn bar-
WHAT: invasion of Ukraine and set energy markets rels of Escalante grade oil at its refinery in Hon-
Northern Argentina and aflutter, appear to be making inroads in at least olulu in April, while multiple cargoes of sweet
western Bolivia are two South American countries. Over the last Medanito crude were delivered to Valero’s plant
experiencing shortages of two weeks, both Argentina and Bolivia have in Benicia, California and Phillips 66’s facility in
diesel fuel. experienced shortages, and domestic suppliers Ferndale, Washington.
have expressed concern about their ability to These barrels from Argentina were surely
WHY: meet demand in the near term. welcomed by US refiners, some of which had
The supply disruptions This essay offers a brief look at recent events been using Russian feedstock to produce diesel.
are following widespread in these two countries. However, Argentina’s own refining sector prob-
disruptions in world oil ably came to regret upstream producers’ deci-
and fuel markets stem- Argentina sion to export those volumes by the end of May.
ming from the Russian Not so long ago, industry observers began to By that point, shortages of diesel were being
invasion of Ukraine.
notice that Argentina was helping US refiners reported in many parts of northern Argentina.
WHAT NEXT: fill some of the gaps resulting from the ban on Moreover, the shortfalls were acute enough that
Bolivia hopes the comple- Russian oil imports imposed by the administra- Oscar Herrera Ahuad, the governor of Misiones
tion of a new terminal tion of President Joe Biden. Province, noted during a formal gathering of the
in Arica will ease supply For example, Reuters noted last month, data governors of 10 northern provinces on May 27
conditions in western from Refinitiv Eikon show that US purchases of that the supply problems might have a negative
regions. crude from Argentina reached a four-year high impact on the yerba mate harvest season.

P4 www. NEWSBASE .com Week 22 02•June•2022