The bad, the bad and the ugly

The bad. The official bulletin on Pemex’s acquisition of the Deer Park refinery in Houston begins with the triumphant phrase proudly repeated by López Obrador: “The operation represents a strategic action by the Government to achieve energy sovereignty in the country . ” Is serious? A half scrap was obtained from which Shell Oil Co. more than willing to get rid of, especially since there are also supply and financial obligations transferred to Pemex during the operation. Also, in the energy transition to clean energy, it did not make sense for Shell to retain Deer Park.

By energy sovereignty, the president means that we will be self-sufficient in gasoline. This is completely untrue. According to official information, Mexico Deer Park will supply 115,000 barrels of crude oil per day and this refinery will return refined products such as gasoline for 230,000 barrels per day. In the balance of payments, the crude oil supplied will be recorded as an export and the returning petrol will be recorded as an import. Are we marching towards self-sufficiency with this? Well no. No one explained it to the president with peritas and apples.

Deer Park, according to Pemex, together with the six existing refineries plus Dos Bocas will represent the “new” energy model of the country. Dos Bocas already has a cost overrun of 56% (4,300 million pesos). But the price does not matter to the government; This is a marvel of Mexican engineering: the first submarine refinery in the world.

common The case of Pedro Salmerón is shameful in several respects: for the victims who see how the harasser is protected by a cloak of impunity; for the foreign service overlapping an ambassador without preparation for the post; for Panama as it is a lack of diplomatic respect. The great Tlatoani forgives Salmerón: “there is no complaint and he is also a great expert on the historical figure of Pancho Villa”. There are now two ways to avoid his appointment: that the Senate be rejected; If the senators do not want to get involved in the controversy of harassment, the simplest thing to do is reject him because of his total lack of capacity for the post.

Panama has already received letters from activist organizations urging them to refuse approval. If he does not want to get into that diplomatic dispute that would ultimately be a mistake for López Obrador, he must negotiate for the government to withdraw his nomination. If Ebrard is smart and steels himself, this is what he should recommend to his boss.

the ugly The most recent data on economic activity is worrying. The fourth quarter will surely see a contraction in GDP. Already the third quarter saw a quarterly decline of 0.4 percent. The slowdown in January indicates a possible negative figure for the first quarter. So we would have three negative quarters, technically a recession.

Expert estimates for the full year range from 1.5% to 2.6 percent. It is clear that the cumulative GDP expansion rate of 2021 and 2022 will not compensate for the 2020 recession. The economy is stagnant.

Twitter: @frubli

Federico Rubli Kaiser


IMEF Magazine

Economist graduated from ITAM. He has a Master’s degree and doctoral studies in monetary theory and policy, and international finance and trade. Columnist for The Economist. He has been an Adviser to the Board of Directors of Banxico, Director of Institutional Liaison, Director of External Relations and Coordinator of the Governor’s Office, External Relations Manager, Macroeconomic Analysis Manager, Deputy Director of Macroeconomic Analysis, Deputy International Economics Manager and Analyst.

Leave a Comment