Regional crude production will decline severely in 2018. Regional production of crude oil and condensate is set to fall by more than 650,000 b/d to 7.9 million b/d in 2018, due mainly to enormous decreased in Venezuela, smaller declines in Mexico, and lackluster growth in Brazil.
Aggressive fuel price increases caused Brazil’s truckers to strike in May. The resulting government subsidy to smooth out diesel prices for consumers will help Petrobras raise runs and avoid sacrificing market share to importers. At the same time, demand is expected to grow by 20,000 b/d to 960,000 b/d. ESAI Energy expects Brazil’s diesel import requirement to remain flat in the second half of 2018 at 210,000 b/d.