Independent US refiner Valero said its permit to import fuel into Mexico has been reinstated after being suspended earlier this month.
The temporary suspension was imposed by Mexico's tax authority SAT on 9 April as part of the country's efforts to fight fuel smuggling, Valero said. The suspension was lifted after the company reached out to stakeholders and customs officials in Mexico and was "quickly exonerated of any wrongdoing," Valero said Thursday morning during its first quarter earnings call.
Fuel smuggling is a rampant problem in Mexico, with illicit fuel sales accounting for up to 30pc of Mexico's 1.2mn b/d of gasoline and diesel demand, according to finance ministry estimates. Most of the illicit supply enters Mexico through mislabeling oil products at the US-Mexico border as petrochemicals, additives or biofuels, which are not subject to to excise taxes on diesel and regular gasoline.
Earlier this month Mexico stopped the movement of all fuel trucks as part of fight against fuel smuggling.
In Mexico,Valero holds gasoline, diesel and jet fuel import permits valid through 2038. Valero is one of only a handful of private-sector companies with such permits. Shell, Marathon and ExxonMobil hold permits to import only gasoline and diesel.
Valero is the largest private fuel importer in Mexico. On 9 April, its sales accounted for 10pc of Mexico's gasoline and diesel demand, according to the company.
Private-sector companies started importing fuel into Mexico in 2016 after the market opened to more competition, but under former president Andres Manuel Lopez Obrador's administration, the energy ministry (Sener) cancelled dozens of fuel import permits.
