Recent actions taken by the Mexican government threaten the important progress that has been made between U.S. energy companies and Mexico’s oil industry.
Hence, U.S. oil companies are calling on President Donald Trump to help persuade Mexican President Andrés Manuel López Obrador not to ditch the energy reforms that his predecessor launched, opening Mexico’s oil industry to private investment, including to U.S. energy companies.
“American companies have invested billions of dollars in Mexico since 2013, primarily in storage, pipelines, and marketing infrastructure,” Chet Thompson, president of the American Fuel and Petrochemical Manufacturers (AFPM), wrote in a letter to President Trump this week, as carried by Houston Chronicle.
Mexico’s populist left-wing President López Obrador has been a vocal critic of the energy reform of his predecessor Enrique Peña Nieto, who opened in 2013 Mexico’s oil and gas sector to private investment for the first time in seven decades.
López Obrador is said to have blasted the energy reform as “a failure” and vowed not to hold new bidding rounds for foreign oil companies for oil exploration and production in Mexico unless those companies show results because currently, they are not investing and not producing. This came barely six months after he took office in December 2018.
It appears López Obrador seeks a greater role for Pemex in reversing the downward trend in Mexican oil production and is criticizing the energy reform and the foreign oil firms for failing to do so.
But U.S. firms have invested in Mexico’s oil industry, and U.S. exports of crude oil and petroleum products have more than doubled over the past half-decade, EIA data shows.
American oil firms are now turning to President Trump to help them keep doing business in Mexico and be treated fairly.