Page 6 - NorthAmOil Week 03 2022

NorthAmOil COMMENTARY NorthAmOil

Biden administration taking new

approach to Mexican energy policy

Washington speaks up in favour of US energy companies seeking to enter Mexico – but for

renewables, not for oil and gas

US-MEXICO MEXICO’S current government, headed by had reason to believe that the Republican legis-
President Andres Manuel Lopez Obrador, had lators who groused about obstacles to US invest-
WHAT: good reason to expect that the outcome of the ment in the Mexican oil and gas sector would
Energy Secretary Jennifer US presidential election in 2020 would work in not receive much sympathy under the Biden
Granholm has criticised a his favour, no matter the results. administration.
proposed amendment to On the one hand, Lopez Obrador got along
Mexico’s constitution. quite well with then-incumbent Donald Trump. No initial surprises
Despite Trump’s provocative remarks about ille- As it happens, Biden defeated Trump in 2020
WHY: gal immigration into the US from Latin America and has now been in office for a year.
Mexico’s president wants across the Mexican border, the two leaders were And for most of that year, there have not
state-owned companies both of a populist bent and dealt well with each been any major surprises in US-Mexico rela-
to lead the energy sector. other. Their relationship was close enough that tions with respect to energy. The closest thing
the Trump administration did not react much to to an upset was the decision in late November
WHAT NEXT: Republican legislators’ complaints that Mexico’s by the Committee on Foreign Investment in the
Washington is not likely government was taking a policy approach that United States (CFIUS) to delay the transfer of a
to throw much weight damaged the interests of US companies working 50.01% stake in the Deer Park refinery in Texas
behind oil and gas in the Mexican energy sector. from Shell (UK) to Mexico’s national oil com-
companies affected On the other hand, Lopez Obrador could pany (NOC) Pemex for several weeks. (In the
by Lopez Obrador’s remain confident that Trump’s Democrat end, though, the delay was only temporary, and
preference for Pemex. opponent Joe Biden would not make relations the sale has now been finalised.)
with Mexico (to say nothing of Mexican energy This week, though, Biden’s Secretary of
policy specifically) a top priority. This was so Energy Jennifer Granholm publicly criticised
partly because he knew Biden would be facing the Mexican government’s energy policy. Dur-
urgent domestic issues related to the coronavi- ing a meeting with Lopez Obrador in Mexico
rus (COVID-19) pandemic and partly because City, she expressed concern about the presiden-
he could expect Biden to strike a different note tial administration’s bid to change the constitu-
on immigration issues. Additionally, he also tion to guarantee that a state-owned company,

US President Joe Biden
and Mexican President
Andres Manuel Lopez
Obrador

P6 www. NEWSBASE .com Week 03 20•January•2022