Considerations on the Reform of the Oil Industry in Mexico

Abstract

The energy reform constitutes a paradigmatic change. It means nearly unrestrictedlegal access to private investments and turns back both the exclusivity of the State inenergy activities and the scope of Nation’s sovereignty over hydrocarbons. The reformproponents believe as a matter of fact that private investors will react on the way theywant to. A naive similar assumption was adopted regarding the convergence of bothinvestors and Nation interests. Without demonstration, based on doctrinarian perceptionof the market laws, it is assumed that maximization of hydrocarbons exploitation,increased income for the government and the reversal of the present decliningtrend of the country’s oil surplus will be in order. As a consequence of the protractedstagnation of the country´s oil processing capacity (refining and petrochemicals) thereform will accentuate the crude oil exporting bias of the past three decades. The newparadigm represents a century long retrogression: a new exporting colonial enclave justified by the assumption that the presence of foreign investment will automaticallytranslate into a widened hydrocarbons horizon for the country.