Peru’s Hidden Gem: Bretaña Crude Oil Gains Traction in the US
The US Gulf Coast has recently welcomed a new player in the crude oil market: Peru’s niche Bretaña crude oil. This rare heavy sweet crude, produced in the Peruvian Amazon rainforest, has caught the attention of US refiners seeking alternatives to declining Mexican heavy crude.
A Unique Profile
Bretaña crude stands out due to its minimal metal content, making it an attractive option for refiners. The oil is transported from the Peruvian jungle to Brazil via barges along the Amazon river, where it is loaded onto larger ships for export.
First Cargo Arrives in the US
The vessel Radiant Pride discharged approximately 300,000 barrels of Bretaña crude in Houston on January 2, marking the first cargo to arrive in the US Gulf Coast. Oil major Shell purchased the cargo, although the company declined to comment on the matter.
Filling the Gap
The decline of Mexican heavy sour crude imports to the US Gulf Coast has created an opportunity for new heavy grades like Bretaña to fill the gap. According to Matt Smith, an analyst at Kpler, this trend is expected to continue as US refiners seek alternative sources.
US Imports from Mexico Plummet
In 2024, US imports from Mexico fell to their lowest record, driven by declining oil production and increased domestic refining in Mexico. This shift has created a demand for new heavy crude sources like Bretaña.
Previous Deliveries
Two cargoes of Bretaña crude were delivered to the US West Coast last year, one to Marathon Petroleum and another to PBF Energy terminals. While Marathon Petroleum declined to comment, PBF Energy did not respond to requests for comment.
Challenges and Opportunities
PetroTal Corp, the producer of Block 95 where the Bretaña oilfield is located, has faced challenges in transporting the crude via a pipeline operated by Peru’s state oil firm Petroperu. However, the company hopes to increase production and is working to secure use of the pipeline infrastructure.
Exporting Success
About 90% of the Bretaña crude produced by PetroTal is exported, with the remaining 10% transported by barges to Petroperu’s refinery in Iquitos. PetroTal has a contract with Houston-based Novum Energy to buy the crude for export and arrange its transportation.
Overcoming Limitations
While permitting delays and reliance on barges are current limitations, PetroTal is working to overcome these challenges. The company is in talks with Petroperu to secure a fair rate for using the pipeline, which would help cover operational costs.
As the demand for alternative heavy crude sources continues to grow, Peru’s Bretaña crude oil is poised to become a significant player in the US market.
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