As an oil-producing country, why are gasoline prices so high in Mexico?

Within Mexico, Pemex is jokingly referred to as the 'nation’s eldest son'—the government relies on it most heavily, yet it also exploits citizens the most severely. Having long served as the government’s 'cash machine,' Pemex has retained insufficient funds for technological R&D and deepwater exploration, plunging it into a crisis marked by aging infrastructure, declining output year after year, and ballooning debt. Today, Pemex ranks among the world’s most indebted oil companies and depends critically on Mexican government fiscal subsidies and credit guarantees to remain operational. Thus, a state-owned enterprise being 'large' and 'strong' does not necessarily benefit ordinary citizens. Some people wonder: Isn’t Mexico America’s backyard? Why haven’t U.S. oil giants like ExxonMobil and Chevron penetrated the market? In fact, these multinational corporations aren’t reluctant to fully seize this lucrative opportunity; rather, facing Mexico’s unique 'national fortress,' they’ve calculated that allowing Pemex to dominate unchallenged represents a dynamic equilibrium emerging from current multilateral bargaining. In Mexico, 'oil belongs to the nation' is no mere slogan—it is enshrined as a core constitutional principle in Article 27. The day in 1938 when President Lázaro Cárdenas nationalized the industry is commemorated by Mexicans as the 'Oil Nationalization Day,' second only to Independence Day. Amid such intense nationalist sentiment, foreign capital attempting to seize Pemex’s core assets would effectively cross a red line for both Mexico’s political establishment and public opinion. Although Mexico launched energy reforms in 2013 to open parts of its market, upon taking office in 2018, current left-wing President Andrés Manuel López Obrador (AMLO) immediately championed 'energy sovereignty,' revitalizing Pemex with strong policy support, halting foreign bidding for oil and gas blocks, and restricting import quotas for foreign-owned gas stations. Faced with such political risks—where policies could abruptly reverse following changes in government—majors like ExxonMobil and BP naturally exercise extreme caution before committing large-scale infrastructure investments. Multinational oil giants are highly commercial, profit-driven entities. They’ve realized they can earn Mexican consumers’ money without directly competing head-on with Pemex on home soil—building pipelines or refineries in Mexico isn’t necessary. Upstream, deepwater exploration and shale oil extraction demand exceptionally advanced technology and massive capital—capabilities Pemex simply lacks. When Pemex sits atop deepwater fields yet cannot extract their resources, it quietly subcontracts or forms joint ventures for these technically demanding, highly profitable deepwater operations to giants like ExxonMobil and BP.

On This Day: June 15, 2026 · Pinhole Mexico—Apizaco

Within Mexico, Pemex is jokingly referred to as the 'nation’s eldest son'—the government relies on it most heavily, yet it also exploits citizens the most severely. Having long served as the government’s 'cash machine,' Pemex has retained insufficient funds for technological R&D and deepwater exploration, plunging it into a crisis marked by aging infrastructure, declining output year after year, and ballooning debt. Today, Pemex ranks among the world’s most indebted oil companies and depends critically on Mexican government fiscal subsidies and credit guarantees to remain operational. Some people wonder: Isn’t Mexico America’s backyard? Why haven’t U.S. oil giants like ExxonMobil and Chevron penetrated the market? In fact, these multinational corporations aren’t reluctant to fully seize this lucrative opportunity; rather, facing Mexico’s unique 'national fortress,' they’ve calculated that allowing Pemex to dominate unchallenged represents a dynamic equilibrium emerging from current multilateral bargaining. In Mexico, 'oil belongs to the nation' is no mere slogan—it is enshrined as a core constitutional principle in Article 27. The day in 1938 when President Lázaro Cárdenas nationalized the industry is commemorated by Mexicans as the 'Oil Nationalization Day,' second only to Independence Day. Amid such intense nationalist sentiment, foreign capital attempting to seize Pemex’s core assets would effectively cross a red line for both Mexico’s political establishment and public opinion. Although Mexico launched energy reforms in 2013 to open parts of its market, upon taking office in 2018, current left-wing President Andrés Manuel López Obrador (AMLO) immediately championed 'energy sovereignty,' revitalizing Pemex with strong policy support, halting foreign bidding for oil and gas blocks, and restricting import quotas for foreign-owned gas stations. Faced with such political risks—where policies could abruptly reverse following changes in government—majors like ExxonMobil and BP naturally exercise extreme caution before committing large-scale infrastructure investments. Multinational oil giants are highly commercial, profit-driven entities. They’ve realized they can earn Mexican consumers’ money without directly competing head-on with Pemex on home soil—building pipelines or refineries in Mexico isn’t necessary. Upstream, deepwater exploration and shale oil extraction demand exceptionally advanced technology and massive capital—capabilities Pemex simply lacks. When Pemex sits atop deepwater fields yet cannot extract their resources, it quietly subcontracts or forms joint ventures for these technically demanding, highly profitable deepwater operations to giants like ExxonMobil and BP. Downstream, Mexico lacks refining capacity. Texas, USA…

Investors Say Time Is Now for Pemex to Tap Global Debt Markets

May 27, 2026

Investors recommend Pemex issue global bonds for the first time in three years to refinance debt amidst strong market appetite. Analysts cite narrowing yield premiums and upcoming maturities as key drivers for the potential issuance.

bloomberg

2026-05-07

Pemex Reports Oil Sheen at Texas Refinery

2026-05-27

Investors Say Time Is Now for Pemex to Tap Global Debt Markets

2026-08-02

Mexico's Pemex completes closure of Krem-1 well months after accident

Investors Say Time Is Now for Pemex to Tap Global Debt Markets

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