Latin American Refining Push: Mexico's Dos Bocas and Cuban Projects Reshape Atlantic Product Flows

Latin America's refining landscape is undergoing its most significant reshaping in a generation. Mexico's 340,000 barrel per day Dos Bocas refinery, formally inaugurated in 2022 and now operating at around 60 per cent of nameplate capacity, has begun producing commercial volumes of low-sulphur diesel and Magna gasoline. Meanwhile, Cuba's plans to expand the Cienfuegos refinery in partnership with Russian and Venezuelan investors aim to add 100,000 bpd of distillation capacity by 2028.

For UK traders accustomed to viewing the Atlantic basin as a single, fluid market, these projects matter. Mexico has historically been the largest single buyer of US Gulf Coast gasoline, importing close to 600,000 bpd at the peak. As Dos Bocas ramps up alongside the rehabilitated Tula and Salina Cruz refineries, that pull is forecast to weaken by 200,000 bpd before 2027. The resulting glut of US gasoline could redirect cargoes towards Europe and the West African basin, pressuring crack spreads at Northwest European refining hubs.

UK refining margins are tightly correlated with these flows. The Phillips 66 Humber and Essar Stanlow plants compete with US Gulf product into the Amsterdam-Rotterdam-Antwerp barge market, and traders at ICE Futures Europe note that the Eurobob non-oxygenated gasoline contract has already begun to show widening contango in the second-half 2026 strip, consistent with anticipated surplus.

For Cuba, the strategic calculus is different. Chronic fuel shortages have plagued the island throughout 2024 and 2025, with rolling blackouts affecting Havana for up to 14 hours daily. The Cienfuegos expansion, if completed on schedule, would reduce reliance on emergency cargoes from Russia and ease pressure on Venezuelan PDVSA exports. UK shipping interests have an indirect stake: Lloyd's of London continues to monitor sanctions exposure carefully, given the involvement of designated entities in some of the financing structures.

The wider Latin American story includes Brazil's modernisation of the REPAR and REDUC refineries by Petrobras, Colombia's continuing Cartagena debottlenecking and Argentina's incremental expansions at Plaza Huincul. Together, these projects could add up to 500,000 bpd of regional capacity by 2030. Wood Mackenzie's Latin American refining team based partly in London estimates that regional product imports could fall by 25 per cent within the same window.

BP and Shell have limited direct exposure to Latin American refining, but their trading arms are deeply embedded in the regional product trade. BP's London-based crude and products desk has reportedly expanded its Mexico coverage, while Shell Trading has been an active counterparty for Brazilian product tenders. The City's commodity banks, including Standard Chartered and Macquarie, finance much of the regional cargo flow.

For UK consumers, the effect is likely to be benign. A better-supplied Atlantic basin should help anchor pump prices, even as crude markets tighten under OPEC+ discipline. The trade-off is competitive pressure on European refiners, who must continue to invest in efficiency and lower-carbon hydrogen integration to remain viable through the late 2020s.