Uncertainty in Mexico’s energy market grows as presidential front-runner plans to freeze the oil auction process until they begin to see results. Germany favors clean air in ruling that allows certain vehicles to be banned. Energy news across the globe was present including Canada, US, and the United Arab Emirates.
Presidential Front-Runner to Reassess Energy Reform
López Obrador, a leftist nationalist is currently the presidential front-runner in Mexico’s upcoming election in July. If Obrador wins, he plans to freeze the oil auction process until they see successful results. In the past three years, Mexico has held eight auctions, awarding 91 exploration and production contracts which is estimated to have an investment of $150 billion. All current contracts are expected to be reviewed and honored, but no additional contracts will be awarded until the first auction is assessed, says Rocío Nahle, a congresswoman and top energy adviser for Obrador.
This announcement adds uncertainty to the Mexican oil market. President Enrique Peña Nieto created the energy overhaul to reverse Mexico’s declining oil production and make Mexico a more competitive energy market. Obrador on the other hand plans to strengthen the state oil company, Petróleos Mexicanos (PEMEX). His plan to do that is shifting from exporting crude oil to exporting more expensive refined products. Obrador plans to build two state-run refineries.
German Court Rules In Favor of Vehicle Ban
On Tuesday, February 27, Germany’s highest administrative court ruled vehicles can be banned from some city streets to improve efforts on air quality. The ban could come into effect for some cities as early as the fall of 2018. This decision could have a major impact on the country’s automakers. The decision is intended to only ban older model vehicles with the highest emissions, focusing on diesel powered vehicles. However, the ruling allows different cities to set their own rules which may result in confusion to consumers. The cities that are expected to implement the ban first will include Stuttgart and Düsseldorf, due to pollution levels being the highest. Stuttgart is home to Porsche and Mercedes.
In Other News
Manitoba has now joined the Pan-Canadian climate-change framework after holding out for more than a year. But the province’s Sustainable Development Minister said she’ll keep fighting to charge a different carbon price than the feds have ordered.
The drive for cost cuts and higher margins at U.S. trucking and railroad operators is pinching their biggest customers, forcing the likes of General Mills Inc (GIS.N) and Hormel Foods Corp (HRL.N) to spend more on deliveries and consider raising their own prices as a way to pass along the costs.
The front-runner in Mexico’s presidential race would hit the brakes on the rapid pace of private investment in the country’s newly opened oil-and-gas sector if he wins the July election, a key adviser to Andrés Manuel López Obrador says.
U.S. President Donald Trump has asked for more talks between representatives of the oil and corn industries after a meeting on Tuesday failed to yield an agreement on how to help refiners cope with the country’s biofuels policy.
Germany’s highest administrative court ruled on Tuesday that vehicles can be banned from some city streets as part of efforts to improve air quality in urban areas, a decision that could have far-reaching consequences for the country’s automakers and the diesel technology they promoted for decades.
OPEC oil output fell in February to a 10-month low as the United Arab Emirates joined other Gulf members in over-delivering on a supply reduction pact.
Per-mile rates eased in February on the spot market, according to monthly rates data from Truckstop.com, dipping from record high averages set in January.
Oil prices rose on Friday as Wall Street stocks bounced off session lows, but benchmark crude futures posted their first weekly decline in three weeks on fears U.S. plans to impose tariffs on steel and aluminum could squeeze economic growth and jitters about rising U.S. crude production.