Latin American Refinery Expansion: Dos Bocas and Cuba Reshape Caribbean Fuel Trade

Latin America is in the middle of its most significant refinery capacity build-out in two decades, anchored by Mexico's Dos Bocas (Olmeca) refinery in Tabasco and a wave of upgrades to Cuban refineries at Cienfuegos and Matanzas. Together, these projects are expected to add over 400,000 barrels per day (bpd) of nameplate capacity to the wider Caribbean and Gulf of Mexico fuel system by the end of 2026.

The Dos Bocas facility, operated by Pemex Transformacion Industrial, has a design capacity of 340,000 bpd and is configured to process Maya heavy sour crude into low-sulphur diesel, gasoline and jet fuel. Construction costs ballooned from an initial US$8 billion to over US$17 billion, and commissioning has faced repeated delays. As of mid-2026, the refinery is operating at roughly 60% of capacity, with full ramp-up expected by year-end. The political imperative under successive Mexican administrations has been to reduce gasoline imports from the US Gulf Coast, which currently exceed 600,000 bpd.

Cuba's refining ambitions, supported by Russian and Chinese partners, are more modest but strategically important. The 65,000 bpd Cienfuegos refinery is being upgraded with Russian technical assistance to process Russian Urals and Venezuelan Merey crude, while the Matanzas terminal has been rebuilt following the devastating 2022 fire. PDVSA continues to supply discounted crude under the Petrocaribe framework, although volumes have fallen sharply from the peaks of the 2010s.

For Trinidad and Tobago, these developments reshape the regional fuel trade. Paria Fuel Trading, which currently imports the bulk of T&T's gasoline and diesel from the US Gulf Coast and the Caribbean ABC islands (Aruba, Bonaire, Curacao), may find new sourcing options as Dos Bocas ramps up. However, Mexican product specifications and logistics costs from the Bay of Campeche to Pointe-a-Pierre would need to be carefully evaluated. The closure of the Pointe-a-Pierre refinery in 2018 left T&T entirely dependent on imports, making the country a price-taker in the regional product market.

The geopolitical implications also matter. Cuban refinery upgrades funded by Russian capital have triggered concerns in Washington about secondary sanctions exposure for Caribbean trading partners, including T&T. The Ministry of Foreign and Caricom Affairs has maintained a careful diplomatic balance, prioritising regional energy security while complying with US Office of Foreign Assets Control (OFAC) guidance.

On the petrochemicals side, expanded Mexican refining capacity could intensify competition for Trinidad's Point Lisas methanol and ammonia exports in the Latin American market. Methanex, Yara, Nutrien and Proman all ship significant volumes into Mexican and Central American markets, where landed costs and tariff structures are highly sensitive to refinery and petrochemical integration projects.

For Caribbean policymakers, the broader lesson is the importance of regional energy cooperation under the Caricom umbrella. Trinidad's role as a natural gas and LNG supplier, combined with Guyana's rising oil output and Suriname's emerging offshore production, creates an opportunity to build an integrated Caribbean energy market that can withstand the volatility of global fuel trade.