At the April 22 virtual Climate Summit organised by United States President Joe Biden, as various countries made commitments to curb their greenhouse emissions, Mexico’s President Andres Manuel Lopez Obrador (AMLO) defended his country’s continuing use of fossil fuels.
He shared that Mexico has discovered three large hydrocarbon deposits, but tried to present this as a development that should please rather than alarm the participants of the summit.
“Although we have discovered three big reserves of hydrocarbons,” the president said, “the oil we’re discovering basically will be destined to cover fuel demand in the domestic market, and the practice of exporting crude will be ended.” By doing so, he added, “we will help avoid the excessive use of fossil fuels.”
While AMLO’s statements at the summit drew extensive criticism from many who saw them as “a declaration of war against clean energy”, there is more to the Mexican leader’s stance on fossil fuels than blatant disregard for the climate emergency.
Asserting ‘energy sovereignty’
Domestically and internationally, AMLO has long been framing Mexico’s dependence on large imports of oil and gas as a crisis of “energy sovereignty”. In response to this crisis, he has strengthened state-run corporations in the electricity generation and fossil fuel industries, and he has also prioritised the use of fossil fuels. These reforms were part of AMLO’s aggressive efforts since 2019 to (re)nationalise energy and fossil fuels in the country.
The idea of “energy sovereignty” has its roots in Mexico’s anti-colonial struggle, during which the country ousted the exploitative US and British companies and nationalised its fossil fuel industry to assert its sovereignty over its resources.
By the turn of the 20th century, the US and British companies had started extracting oil reserves in Mexico. Although by 1921 these companies had expanded Mexico’s oil production until it was second only to the US, the wealth generated from this extraction flowed back to the US and Britain, and did very little to improve the economic conditions in Mexico – a typical colonial relationship of exploitation.
These foreign companies only had British and US nationals in their key positions. Moreover, a Mexican worker received half the wages and poorer housing for doing the same job as a foreign worker.
Article 27 of the 1917 Mexican constitution gave the Mexican government the right to expropriate resources such as oil. But the implementation of this article proved impossible due to fierce resistance by the oil companies which were backed by the US Department of State.
The presidency of Lazaro Cardenas (1934-1940) marked a significant transformation: he oversaw massive land redistribution and supported workers’ right to strike. On the issue of oil, the Mexican authorities under his administration sided with striking Mexican workers and asked the oil companies to increase wages and benefits, but the companies refused to comply.
In response, Cardenas used Article 27 and nationalised the foreign oil companies in Mexico on March 18, 1938 – which led to the formation of state-run PEMEX with its monopoly over fossil fuels. Around this period, Cardenas also created state-run CFE, responsible for the generation and distribution of electrical energy.
