The number three supplier of crude oil to the USA is Mexico. In case you haven’t noticed, the oil industry in Mexico is experiencing unrest. Proven reserves have dropped from 34.2 billion barrels in 1998 to 14.7 billion in 2007. This is serious business for the US.
The government in Mexico is looking for outside investors to come in and help find new oil. There are riots. The Nationalization of the oil business in Mexico on 3-18-38 is a famous date in Mexico. Pemex controls all aspects of the oil business in Mexico. Right to the pump. Profits go to taxes which is 40% of the Mexican budget.
We are poaching some oil near Mexico in the Gulf with deep water wells within 6 miles of their territorial waters. Good for us. If we could drill in our waters we might not need to piss them off, but so beit. Wait, they supply a big piece of our insecure supply needs. Their technology is lagging. They need outside investment and technology or their supply may go away.
What happens if riots break out in Mexico and there are strikes and supply disruptions? Very likely. Maybe soon. Guess we have $5 gasoline overnight.
Don’t worry, Al Gore’s cell number is: 513-555-1515 call him if you don’t like it.
