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US hopes for show of unity with Mexico at Cop 28

  • Market: Crude oil, Electricity, Emissions, Natural gas
  • 17/11/23

US president Joe Biden urged his Mexican counterpart, Andres Manuel Lopez Obrador, to step up their countries' cooperation on climate issues ahead of the upcoming Cop 28 UN climate conference.

The US wants to demonstrate at Cop 28 that "the US, Mexico and Canada are working in lockstep on this issue," a senior US official told reporters following today's meeting of the two leaders at the Asia-Pacific Economic Cooperation forum in San Francisco.

The two presidents did not directly address an ongoing trade dispute related to energy, which remains on track to be resolved within the US-Mexico-Canada free trade agreement. The US complaint centers on Mexico's attempts to dial back the 2014 energy reform over the last five years with laws to favor state-owned Pemex's position in the Mexican fuels market, curtail private-sector renewable energy development and prioritize state utility CFE power dispatch.

Biden and Lopez Obrador "acknowledged that we have a broad and deep economic relationship, and like in any sort of any such relationship there will be disagreements," the senior US official said. "We have mechanisms where we're going to work through those issues in a way that is respectful and characteristic of what is one of the most consequential and strategic economic relationships that the US has."

Climate change policies is another area of disagreement between the two governments, and it is not clear if Biden's call for additional action will succeed.

While Mexico agreed last year to a tougher new greenhouse gas reduction target of 35pc by 2030 from a 2000 baseline, development of new clean energy capacity has been limited to the first 125MW phase of the 1GW Puerto Penasco solar plant and the upgrade of a series of hydroelectric plants.

Energy regulator CRE in May approved changes reclassifying gas-fired combined-cycle plants as clean energy sources, allowing them to contribute to Mexico's target of generating 35pc of its power from clean energy by 2024. Giving priority to legacy gas-fired generation forms a core part of the US complaint, as they put US-funded renewable power projects in Mexico at a disadvantage.

Biden's meeting with Lopez Obrador has prioritized cooperation to curb migration and drug trafficking.

"We've seen our cooperation to address historic levels of migration and I want to thank you, Mr. President and your team, for the cooperation, your leadership, you taking on this challenge," Biden told Lopez Obrador.


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New Libyan firm starts exporting crude


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