Mexican GDP growth in 4Q lowest since 2021

Market: Crude oil, Metals, Oil products
31/01/25

Mexico's economy slowed in the fourth quarter to its lowest pace since early 2021, as the agriculture and industrial sectors dragged on growth.

Mexico's gross domestic product (GDP) growth slowed to annualized rate of 0.6pc, statistics agency Inegi reported. This is down from an annual 1.6pc in the third quarter and 2.1pc growth in the second quarter, which was the strongest quarter last year.

The result marks the slowest growth in 15 quarters for Mexico, coming in below estimates.

This was largely due to annualized 4.6pc decline in the agriculture sector, swinging from 4.1pc growth in the third quarter as drought conditions return.

Inegi reported the industrial component of GDP also contracted, down 1.7pc in the fourth quarter, compared with a 0.5pc expansion in the previous quarter, on slowing construction and persistent declines in the oil component.

Services, meanwhile, expanded an annualized 2.1pc in the fourth quarter, compared with a 2.2pc expansion in the previous quarter.

Inegi reported full-year GDP growth at 1.5pc in 2024, slowing from 3.3pc in 2023 and the lowest level since the pandemic-stricken downturn in 2020.

By James Young

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News

02/03/25

Ecuador awards Sacha field to Sinopec, Petrolia

Quito, 2 March (Argus) — Ecuador will transfer operation of its highest-producing oil field, the 74,600 b/d Sacha, to a consortium of China's Sinopec and Canada-based Petrolia under a production-sharing contract aimed at increasing output, the energy ministry said today. The consortium, in which Sinopec as operators hold a 60pc share and Petrolia the remainder, committed to investing $1.7bn in the next six year to reach peak production of 100,000 b/d by 2028, up by 33pc compared with current output. State-owned Petroecuador currently operates the field in block 60 in the Orellana province in the Amazonian region. Energy minister Ines Manzano authorized the deal through a resolution, and vice minister of hydrocarbons Guilhermo Ferreira was charged with signing the 20-year contract. Most terms have already been negotiated and final signature should not take more than a few weeks, the ministry said. The consortium had proposed keeping from 80pc-87.5pc of production, depending on the price of WTI crude, Petrolia's general manager Ramiro Paez previously told Argus . If the WTI price is below $30/bl, the consortium will take 87.5pc of the production. But its production sharing will decrease on a sliding scale to a minimum of 80pc when the WTI price is $120/bl or above. Ecuador's government will keep 80pc of profits, when taxes and other fees are taken into account, the consortium has said. Transitioning operations from Petroecuador to Sinopec will take about six months, said Paez. Opposing forces Ecuador's oil workers' unions have rejected the plan as unconstitutional because it passes control of the field from the state-owned company, as have opposition legislators with the citizens' revolution party that holds a majority in congress. The deal will cost Ecuador's government $8bn, the party claims. They also complained that the government announced the decision at the start of a holiday weekend. Manzano defended the deal as constitutional as the hydrocarbons law allows the government to delegate crude field operations. The energy ministry will provide additional details about the deal on 5 March after the 3-4 March holiday for Carnival. From 1-27 February 2025, Sacha produced an average of 74,680 b/d, down by 4pc compared with 77,884 b/d in February 2024, according to the data published by the hydrocarbons regulatory agency (Arch) and Petroecuador. Ecuador produced 474,860 b/d in January. By Alberto Araujo Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Find out more

News

Weak Canadian dollar may offset US tariffs: MEG

28/02/25

News

28/02/25

Weak Canadian dollar may offset US tariffs: MEG

Calgary, 28 February (Argus) — The impact of the US' planned 10pc tariff on Canadian energy imports is likely to be "relatively muted" with a weaker Canadian dollar helping to cushion the impacts on US dollar-denominated Western Canadian Select crude, according to Canada's largest pure-play oil sands producer today. "You might see a $2-4/bl widening in the WCS diff, but we're also seeing a weakening in the Canadian dollar at the same time. That's going to offset that," MEG Energy chief financial officer Ryan Kubik told analysts. The Canadian dollar, on average, was worth C$1.37 to the US dollar in 2024, weakening from C$1.35 to the greenback in 2023 and the weakest since 2003, according to the Bank of Canada. The Canadian dollar has since depreciated further to C$1.43 to the US dollar in February, a benefit to Canadian producers selling crude in US dollars. Heavy sour Western Canadian Select (WCS) in Alberta was under pressure in early February when tariffs looked likely, but were subsequently postponed to 4 March. WCS trades at a discount to the US light sweet benchmark and this week has been hovering around a $13/bl discount, roughly $2/bl narrower than before the tariff threat nearly one month ago. US president Donald Trump said he plans to impose a 10pc tariff on energy, and a 25pc tariff on all other imports from Canada, next week. That has caused confusion for the market with little details on how it would work. Additionally, it is unclear who may bear the brunt of the added tax, but Canadian producers seem likely to share in that cost along with refiners and consumers, to a varying degree. Kubik discussed the prospect of hedging more volumes at current WCS prices, but said participants are limited by the "very illiquid" nature of the market. "There's not a lot of appetite to get out there and put a position on because it's just not that meaningful," said Kubik. "And when you consider the impact of tariffs, we actually think it may be relatively muted." For the moment, most of the volume moving westbound on the 890,000 b/d Trans Mountain system, which enables Canadian producers to bypass the US entirely by exporting to the Pacific Rim, is on existing contracts, according to MEG's senior vice president of marketing Erik Alson. "I think where you're likely to see spot shipments moving would be more around the time when, if, tariffs come into effect," said Alson. "That's when you'd see the extra incentive to move a significant amount of spot capacity." MEG is a committed shipper on TMX but also routes crude through the US Gulf coast, and more than half of MEG's sales could be non-tariffed, depending on the details in the executive order. MEG reported Friday its bitumen output fell to 100,100 b/d in the fourth quarter , down from 109,100 b/d in the fourth quarter of 2023. The Calgary-based company posted a profit of C$106mn ($73mn) in the fourth quarter, up from C$103mn in the fourth quarter of 2023. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Energy a priority for Uruguay’s new government

28/02/25

News

28/02/25

Energy a priority for Uruguay’s new government

Montevideo, 28 February (Argus) — Energy will play a central role as Uruguay's new president Yamandu Orsi begins his five-year term on 1 March. Orsi, of the left-wing Broad Front coalition, takes over one of South America's most economically and politically stable countries. The economy is forecast to expand by 3pc this year, above the regional average, and the government wants to attract investment to maintain growth. The energy sector is a priority. Uruguay already has one of the region's cleanest grids, with 99pc of power coming from renewable sources, and in February reached the goal of 100pc electrification nationwide, according to the state-run electric company, UTE. The Orsi administration is studying options for the second phase of the energy transition, which includes adding capacity to meet increasing demand from electrification of transportation and clean fuel production. New finance minister Gabriel Oddone said the administration would focus on reducing red tape and potentially provide incentives for investment in the energy sector. Uruguay currently has close to 5.3GW of installed capacity, with 78pc in renewable sources, for its population of 3.5mn. The UTE, which had a profit of $315mn in 2024, is adding 100MW in wind power in the next two years. The Orsi administration plans to prioritize solar capacity. The new government is keenly following the development of low-carbon hydrogen and e-fuel projects. The most advanced project is for production of 700,000 tonnes (t) of synthetic fuel by Chile's HIF Global and ALUR, the biofuel arm of the state-owned Ancap. Investment is estimated at $6bn, making it the largest planned single investment in the country's history. The company requested approval in January of environmental permits for the project's solar park that would include 1.84mn bifacial solar panels. It would produce a peak of 1,162MW. Construction would take 18 months from approval. The municipal council in Paysandu, in northwestern Uruguay where the project is planned, on 27 February approved a change in land use to facilitate plant construction. Ancap, which lost an estimated $130mn last year because its only refinery was closed for six months, has proposed offshore production of low-carbon hydrogen. The Orsi administration has not yet committed to the project. Reverse transition? The new government will also have to also have to decide on the future of seven offshore exploration blocks, with seismic testing planned for late this year, and the possible construction of a gas pipeline that would link Argentina and Brazil. A pipeline exists from Argentina to Uruguay, but it could be expanded and extended to supply southern Brazil. It would require an additional 415km (258mi) in Uruguay, and around 500km in Brazil's Rio Grande do Sul state. Orsi has taken a wait-and-see attitude toward exploration, while a gas pipeline would likely have more popular support because it could expand service from only a section of the coast to a wider region. By Lucien Chauvin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Low flood risk expected for upper Mississippi River

28/02/25

News

28/02/25

Low flood risk expected for upper Mississippi River

Houston, 28 February (Argus) — The spring flood risk is low along the upper Mississippi River, as area soils and streams have amble capacity to accommodate seasonal precipitation, according to the National Weather Service (NWS). Precipitation in the Corn Belt has been below normal this winter, keeping the region abnormally dry, the NWS said Thursday in its second Spring Flood Outlook . Minimal snow pack has formed in the Northern Plains following lackluster winter precipitation. Both these factors have reduced the risk for March-April flooding along the upper Mississippi River. Around 0-2in of water equivalent are in the snowpack along the northern stretches of Minnesota, Wisconsin and Michigan. In addition, stream flows are below normal, giving them more capacity to handle spring rains and snow melt. In other areas of the Corn Belt and the Northern Plains, unfrozen soil is expected to soak up precipitation, asmoisture levels remain below normal. Southern Illinois and Missouri have no frozen soil, completely thawing since the previous outlook . Iowa has 16-24in of frozen soil, slightly higher over the past two weeks. Northern states such as Minnesota and Wisconsin still have an average of 24-36in of frost depth. These states have the entire month of March to defrost and gain moisture levels, since the majority of spring planting for the Corn Belt begin in April. Normal precipitation is projected for the upper Mississippi River basin through the first half of March, according to the NWS' Climate Prediction Center. The seasonal temperatures outlook for March-April are near normal, while precipitation is anticipated to be above average. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

UK reviews steel safeguard developing country status

28/02/25

News

28/02/25

UK reviews steel safeguard developing country status

London, 28 February (Argus) — UK government body the Trade Remedies Authority (TRA) is reviewing the developing country exceptions in its safeguard, it said today. The review will likely mean Vietnamese hot-rolled coil comes into the scope of the safeguard. Vietnam had a 10pc share of the UK's third-country steel imports from outside of the EU last year, at just over 42,000t. Any developing country with more than a 3pc share of the UK's non-EU imports will come into the safeguard's scope. Egypt will likely come into the safeguard as well, as it held a more than 6pc share of the UK's third-country imports last year. Market participants have until 14 March to comment on the proposed changes, with the TRA planning to make its statement of intended final recommendations on 28 March. It will make its final recommendation on 30 June. This timeline suggests any changes will come into force from 1 July. UK steelmakers are lobbying for tighter import restrictions in light of fresh 25pc import tariffs in the US and the EU's steel safeguard review. The EU review will "meaningfully" reduce the bloc's imports, several sell-side sources suggest. The idea of blanket tariffs in the UK have been muted by some market participants, but many question whether the UK would take such an approach. It is unlikely that the review of the UK's developing country exceptions will be the only measure the country takes, with other potential restrictions likely in the pipeline. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more