Mexican Crude Production Collapses Ahead of Elections – High demand sends LNG prices climbing around the world!
– Providing a somber reflection on Mexico’s upstream industry before the June 2 general election, crude production by Mexico’s state oil company Pemex fell below 1.5 million b/d for the first time in over 40 years.
– April’s crude output of 1.474 million b/d represents an almost 200,000 b/d year-over-year drop. It marks a new trough for the country! This is the lowest point since Mexico started producing from the giant Cantarell field and tapped into its prolific offshore waters in the late 1970s.
– The Lopez Obrador government forbade new hydrocarbon bidding rounds. It has instructed Pemex to focus on onshore and shallow-water fields rather than investing into higher-risk projects.
– Higher condensate production from onshore assets such as Ixachi or Quesqui offset some of the declines in total supply figures, however not enough to halt the tide of legacy declines.
Could AI Gas Demand Lift US Natural Gas Prices
– US natural gas prices are set for structural upside over the next 20 years as incremental demand from data centres and AI has prompted a gas generation renaissance.
– According to WoodMackenzie, the growth in US natural gas demand could amount to as much as 30 BCf/d, pushing Henry Hub futures above $4 per mmBtu by 2035 and closer to $6 per mmBtu by 2045.
– Electricity demand from data centers currently adds up to 11 GW of generation, but this should…
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Source: Oil Price
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