(John Kemp is a Reuters market analyst. The views expressed are his own)
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By John Kemp
LONDON, May 17 (Reuters) - Mexico’s oil consumption has started growing again in 2016 after declining for three years between 2013 and 2015.
According to the ministry of energy, consumption averaged 1.67 million barrels per day (bpd) in the first three months of the year, an increase of 2.1 percent compared with the same period in 2015 (tmsnrt.rs/1WCxbZd).
Oil demand remains well below the peak of 1.93 million bpd recorded in the last quarter of 2012 but is exhibiting the first sustained year-on-year growth since then (tmsnrt.rs/1WCx9R6).
Mexico is the twelfth-largest oil consumer in the world and second-largest in Latin America after Brazil (“BP Statistical Review of World Energy” 2015).
Gasoline accounts for almost half of the country’s oil consumption and strong growth in gasoline consumption has led the resumption in demand growth.
Gasoline sales averaged more than 800,000 bpd during the first quarter, an increase of 35,000 bpd or 4.6 percent compared with the same period in 2015 (tmsnrt.rs/1V7sJ3M).
Mexico’s refineries are unable to meet all the domestic demand for gasoline or diesel and the country is a major importer of motor fuels, especially gasoline.
Mexico imported around 360,000 bpd of gasoline in 2015, net of exports; the country relied on imports for nearly half of its total requirements.
In gasoline, the United States and Mexico are each other’s biggest trading partners. U.S. refineries provide more than half of Mexico’s gasoline imports, and Mexico accounts for about half of all U.S. gasoline exports.
Growing demand from drivers in Mexico has played a small but important role in keeping gasoline margins high for U.S. refiners (tmsnrt.rs/1V7sW72).
More generally, strong gasoline demand from the United States, India, China and Mexico is accelerating global oil consumption and playing a vital role in rebalancing the oil market.
The strength of demand from these economies is helping to offset stagnant or falling growth in the Middle East and Brazil.
But Mexico's strong demand for gasoline is not matched by demand for diesel, which continues to fall, adding to the global imbalance between the two major transportation fuels (tmsnrt.rs/1V7sKEV). (Editing by Susan Thomas)