# [WARNING] Ecuador Fuel Shortages Deepen as Esmeraldas Refinery Nears Collapse

*Tuesday, May 12, 2026 at 3:32 PM UTC — Hamer Intelligence Services Desk*

**Detected**: 2026-05-12T15:32:32.420Z (2h ago)
**Tags**: MARKET, ENERGY, refining, LatAm, sovereign-risk, diesel
**Sources**: OSINT
**Permalink**: https://hamerintel.com/data/alerts/6554.md
**Source**: https://hamerintel.com/summaries

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**Summary**: Multiple reports from Quito confirm widespread gasoline shortages, with at least three stations closed and others limiting hours, while distributors warn of a looming collapse at the key Esmeraldas refinery after a recent fire. This points to an acute domestic fuels supply crunch that will require higher imports of diesel and gasoline, marginally tightening regional products markets and adding to political risk in Ecuador’s energy sector.

## Detail

1) What happened: In the last hour, Ecuadorian outlets and industry representatives have reported a sharp escalation in domestic fuel supply problems. Field checks in Quito (reports [11] and [16]) identify at least three gas stations closed due to lack of fuel, with others only opening in the afternoon. The national distributors’ association (CAMDDEPE) publicly contradicts government assurances, citing clear evidence of scarcity ([65]). A technical expert notes that the Esmeraldas refinery, which only recently restarted after a fire, is producing just ~10,000 bpd of diesel versus 33,000 bpd pre-incident, and describes the steam system as highly vulnerable and the plant “on the verge of collapse” ([64]). There are also citizen complaints of irregular retail practices (sale in canisters, [74]), suggesting physical tightness at the pump.

2) Supply impact: Ecuador consumes roughly 90–100 kbpd of diesel and significant volumes of gasoline; Esmeraldas is its main refinery. A cut from 33 kbpd to 10 kbpd in diesel output implies a loss of about 23 kbpd of domestic diesel supply, which must be replaced via imports or rationing. If the plant suffers further outages, the shortfall could reach 30 kbpd+. For a small importer, this is large and can strain fiscal accounts and FX reserves, especially with oil already above $100/bbl ([57]). The immediate effect is an increase in Ecuador’s import demand for refined products and heightened risks of logistical disruptions to transport, agriculture, and industry.

3) Market impact: Globally, 20–30 kbpd of additional diesel/gasoline import demand is marginal, but in a tight Atlantic Basin products market, regional benchmarks (US Gulf Coast diesel and gasoline, thus influencing ICE gasoil and NYMEX RBOB) could see incremental bid support. The more immediate market-moving angle is sovereign and credit risk: higher import bills and visible fuel shortages raise the probability of social unrest (indigenous groups already protesting fuel price hikes, [15]) and policy shocks such as price freezes, emergency subsidies, or ad hoc contract changes affecting the hydrocarbon sector. This can widen Ecuador sovereign spreads, pressure the USD/Ecuador country risk premium, and affect bonds of state-linked entities.

4) Historical precedent: Ecuador has a history of fuel-related unrest (e.g., October 2019 subsidy protests) that quickly escalated into nationwide blockades affecting oil production and exports. While current reports are early-stage, the combination of refinery fragility, higher pump prices, and indigenous mobilization is a classic precondition to road closures and possible disruptions to crude logistics.

5) Duration: If Esmeraldas stabilizes and imports are quickly arranged, the direct products impact is likely transient (weeks). However, risks of structural underinvestment in refining and rising political resistance to price reform suggest an elevated medium-term risk premium on Ecuadorian sovereign and quasi-sovereign paper, and a non-trivial tail risk of crude export disruption should protests spread.

Directionally, this development is mildly bullish regional refined products, bearish Ecuador sovereign credit, and increases the local political and operational risk premium for energy assets in Ecuador.

**AFFECTED ASSETS:** ICE Gasoil, NYMEX RBOB gasoline, USGC diesel cracks, Ecuador sovereign bonds, PetroEcuador-related credit, Andean corporate credits