If experts are correct, the looming election of Alejandro Encenas, as Mexico's next president, could bode poorly for us oil-hungry Americans. Encenas and his PDR party have no plans to put any money into Mexico's aging and failing oil industry.
reports that Mexico has likely ceased investment into its technologically deficient oil infrastructure. Before you shrug your shoulders and say so what...remember that Mexico is our 3rd largest supplier of oil. As they begin to run out of oil for their own use, they will be forced to stop all exporting, then as they continue to exhaust their reserves, they will have to start mporting oil to fill the void. This means that they will be then competing with us and other buyers in the world oil market.
President Calderon had planned to utilize foreign partnerships to gain the much needed modern technology in order to revamp Mexico's oil industry. Encenas and his PRD party hold isolationist views and he clams that he is:
"defending Mexico's patrimony and national interest" — by leaving its oil in the ground
.
Given that the Mexican government gets about 40% of its revenue form the sale of oil. The loss of this revenue will severely strain Mexico's very modest economic growth and could force even more desperate people to illegally enter the US in search of work.
The potential loss of one of our top oil suppliers should spark serious discussions on how to find ways to take advantage of our own untapped resources like those in Alaska's Arctic National Wildlife Refuge or off shore on the outer continental shelf.
As stated in
Investor's Business Daily
If Mexico's looming oil troubles can at last get Congress' attention, new production could come just in time to replace the oil lost by a vital, yet now potentially unreliable, foreign supplier.
For the U.S., there are no other options. When will it wake up?
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