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Mexican GDP growth in 4Q lowest since 2021

  • Spanish 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


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03/03/25

US manufacturing slows in February: ISM

US manufacturing slows in February: ISM

Houston, 3 March (Argus) — Manufacturing activity in the US slowed in February as demand weakened, output growth eased and prices surged as producers braced for a raft of tariffs threatened by the new US administration. The Institute for Supply Management's (ISM) manufacturing purchasing managers index registered 50.3 in February, down from 50.9 in January, marking a second month of growth after 26 consecutive months of contraction. The breakeven point between growth and contraction is 50. Economists surveyed by Trading Economics had forecast 50.5 for the headline reading. "US manufacturing activity expanded marginally for the second month in a row in February," ISM said. "Demand weakened, while output stabilized. Inputs — defined as supplier deliveries, inventories, prices and imports — revealed the first signs of supplier difficulties due to some pull-forward deliveries and discussions about who will pay for tariffs." The new orders index dropped back into contraction territory in February after expanding for three months, registering 48.6 percent, down from 55.1 in January. The production index was at 50.7, down from 52.5 in the prior month but still showing growth after eight months of contraction. The prices index surged to 62.4, up from 54.9 in January. The backlog of orders index registered 46.8, up from 44.9 in January. The employment index came in at 47.6, down from 50.3 the prior month. The supplier deliveries index was at 54.5, up from 50.9 and indicating further slowing in deliveries as the economy improves. The new export orders index reading of 51.4 was down from 52.4 in January, showing slowing growth. The imports index rose to 52.6, up from 51.1 in January. Comments highlight tariff information vacuum Comments from survey participants showed a great deal of uncertainty about how the White House's tariff plans would effect operations and the economy. "The tariff environment regarding products from Mexico and Canada has created uncertainty and volatility among our customers and increased our exposure to retaliatory measures from these countries," a chemical products producer said in the survey. A transportation equipment manufacturer said that customers had paused new orders because of the many unknowns around the US' tariff plans. "There is no clear direction from the administration on how they will be implemented, so it's harder to project how they will affect business," the company said. The threat of the tariffs had had minimal impact on overall manufacturing and raw material supply as of the time of the survey, according to an electronics manufacturer. But limits on US government spending from organizations like the Food and Drug Administration, Environmental Protection Agency and National Institutes of Health were delaying some orders, the company said. But a machinery manufacturer said the pending tariffs were leading to higher costs for its products. "Sweeping price increases are incoming from suppliers. Most are noting increases in labor costs. Vendors are indicating open capacity. Inflationary pressures are a concern," the company said in the survey. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Venezuela oil can flow despite sanctions U-turn


03/03/25
03/03/25

Venezuela oil can flow despite sanctions U-turn

Washington, 3 March (Argus) — Venezuelan crude could remain available to most current buyers in the near future even though US president Donald Trump's administration says it is closing exceptions in sanctions against Caracas. Trump on 26 February said he would not extend a sanctions waiver that allowed Chevron to lift crude cargoes from its joint venture with Venezuelan state-owned PdV. US secretary of state Marco Rubio last week separately said via social media that he would recommend terminating all "oil and gas licenses that have shamefully bankrolled the illegitimate regime" of Venezuelan president Nicolas Maduro. Under normal circumstances, such announcements by the US administration include detailed guidance from the Treasury Department's sanctions enforcement arm, the Office of Foreign Assets Control (OFAC). But OFAC in its guidance issued on Sunday, days after Trump's announcement, merely said it was "preparing to take action to wind-down General License 41 and other specific licenses as appropriate." General license 41 is the authorization for Chevron's activities in Venezuela, which was issued on 26 November 2022. "We will issue additional guidance to assist implementation concurrent with any changes to the authorization(s)," OFAC said. The 2022 authorization for Chevron was auto-renewed every month and allowed the company to operate in Venezuela for a six-month period after each renewal. Since Trump noted that he would not renew the license on 1 March, the terms of that license in theory allow Chevron to continue loading cargoes from Venezuela until at least 1 August. Multiple other foreign oil companies and traders hold OFAC licenses with sanctions waivers allowing them to load crude and other energy commodities from PdV. Former president Joe Biden's administration issued such authorizations because their terms do not involve direct payments to PdV. Most cargoes are loaded by operators in exchange for writing down debts owed to them by the Venezuelan government or by PdV. Caracas began to selectively default on its debts to foreign creditors in 2018, and foreign creditors have advanced claims totalling over $60bn. A group of those creditors have succeeded in forcing a sale of PdV-owned US refiner Citgo through a yet-incomplete auction overseen by a US federal court in Delaware. OFAC typically does not disclose sanctions waivers granted to individual operators. Some of them, including Spain's Repsol and Italy's Eni, previously have made public disclosures about holding limited sanctions waivers. It is also not clear if sanctions waivers issued to oil field service companies Halliburton, SLB, Baker Hughes and Weatherford, to enable their continued presence in or a future return to Venezuela, will remain in place. Trinidad and Tobago, which has a sanctions waiver to pursue a project to import Venezuelan gas for a Trinidad-based LNG project, said last week it "will do all in its power" to preserve cross-border oil and gas production agreements. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Sheinbaum urges calm ahead of Trump tariff deadline


03/03/25
03/03/25

Sheinbaum urges calm ahead of Trump tariff deadline

Mexico City, 3 March (Argus) — Mexico will deliver a composed and measured response if the US imposes tariffs on its imports as threatened tonight, although there has been no definitive word on what will happen, President Claudia Sheinbaum said. US president Donald Trump postponed an early February deadline to impose 25pc tariffs on all Mexican and most Canadian goods by a month to allow more time for negotiations over what he said were concerns over the flow of drugs and immigrants into the US. This followed Sheinbaum pledge to send another 10,000 national guard troops to the border to curtail drug trafficking, with a specific focus on fentanyl. Mexico has continued talks with the US this past month to demonstrate results of its efforts. But the Mexican government does not yet know if this has been sufficient to convince Trump to further pause tariffs, Sheinbaum said this morning. "Whatever the decision is, we will have a plan to respond," Sheinbaum said during her daily press conference. Mexico has a plan that includes retaliatory tariffs as an option, Sheinbaum said last month. US commerce secretary Howard Lutnick said on a broadcast interview Sunday that the US will likely implement the tariffs on Canada and Mexico, but that Trump could lower the tariffs below 25pc. Lutnick described the situation as "fluid", leaving open the possibilities for last-minute negotiations. Sheinbaum could still have a call with Trump before the deadline expires, much like last month, when the tariffs were postponed following talks between the presidents , Sheinbaum said last week. Sheinbaum said such a call could come today. Tariffs would likely curtail energy trade between the US and Mexico. Nearly all of Mexico's roughly 500,000 b/d of crude shipments to the US in January-November 2024 were waterborne cargoes sent to US Gulf coast refiners. Those shipments in the future could be diverted to Asia or Europe. Mexico also imports much of its road fuels and LPG from the US. But hitting these goods with retaliatory tariffs would be costly for Mexico and may be unlikely, according to market sources. By Cas Biekmann Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US sends mixed signals on Canada, Mexico tariffs


03/03/25
03/03/25

US sends mixed signals on Canada, Mexico tariffs

Washington, 3 March (Argus) — President Donald Trump's top economic advisers are providing conflicting guidance on the tariffs the US will impose on Canadian and Mexican imports as early as Tuesday. The effective date for the tariffs, which Trump announced via an executive order a month ago, is 12:01am ET on Tuesday. The executive order calls for imposing a 10pc tax on Canadian energy imports, a 25pc tariff on non-energy imports from Canada and a 25pc tariff on all imports from Mexico. Trump last week said that the tariffs will go into effect as planned. But US treasury secretary Scott Bessent over the weekend referenced a proposal by Mexico City to match the level of tariffs Trump has leveled or is planning to impose on imports from China, as a way to avoid a trade war between the US, Mexico and Canada. "It would be a nice gesture if the Canadians did it also, so in a way we could have ‘Fortress North America' from the flood of Chinese imports," Bessent said in a televised interview. Trump ordered a 10pc tariff on all imports from China, effective on 4 February. He is threatening to double that tax on Tuesday. The rate would be in addition to all previously imposed tariffs on imports from China. US commerce secretary Howard Lutnick, in turn, said on Sunday that the import taxes on Canada and Mexico would proceed as scheduled, but their exact levels may not be as high as set out in Trump's order last month. "There are going to be tariffs on Tuesday on Mexico and Canada," Lutnick said. "Exactly what they're going to be, I'm going to leave that for the president to decide." Trump's economic adviser Kevin Hassett separately suggested that the tariffs could go into effect at the levels Trump set, but that the White House could lower them over time if talks with Canada and Mexico on border security are successful. The Canada and Mexico tariffs are not in place yet, but vast segments of the energy industry — oil and gas producers, refiners, pipeline operators, traders — already are bracing for potentially disruptive outcomes. US independent refiners, already facing weaker margins, falling demand and regulatory uncertainty in their burgeoning renewables businesses, expect that tariffs will lead to higher feedstock costs and will cause some to reduce runs, cutting further into profits. A major European energy trading company has redirected some volumes of natural gas that were scheduled to flow across the US border into Canada to reduce the company's exposure to the threat of impending tariffs. The imposition of tariffs after decades of free trade in energy across North America is expected to create legal uncertainty in contractual obligations related to the payment of tariffs and reporting requirements. The current US import duties on crude are set at 5.25¢/bl and 10.5¢/bl, depending on crude quality. The administration has said the new tariff would be based on the value of the commodity — without specifying how that will be calculated and at what specific point during the transportation process. US government agencies are not expected to clarify the implementation details until Trump's executive order on tariffs goes into effect. By Haik Gugarats Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Q&A: ExxonMobil sees pathway to eight Guyanese projects


03/03/25
03/03/25

Q&A: ExxonMobil sees pathway to eight Guyanese projects

New York, 3 March (Argus) — ExxonMobil has a "line of sight" to eight projects in Guyana, which will help drive up production from the prolific offshore Stabroek block in coming years. And more is possible as the prospecting licence for the block still has another two-and-a-half years to go, ExxonMobil's Guyana president, Alistair Routledge , told Argus' Stephen Cunningham in an exclusive interview on the sidelines of the recent Guyana Energy Conference and Supply Chain Expo in Georgetown, Guyana. How will this year's general elections affect your operations in Guyana? We take a long-term perspective. Our job is to work with whichever administration is voted in, and to ensure that it's a collaborative relationship, it honours past commitments, and also that it ensures the long-term attractiveness of this location for future investment. How do you view Guyana's shallow-water blocks? We participated in the 2022 licensing round, and we were awarded the S8 block, along with our partners, [US firm] Hess and [China's] CNOOC. We continue in our discussions with the government to try to finalise a petroleum agreement. What about other deepwater blocks? We recently relinquished our interest in the Kaieteur block. Just as we looked at the opportunity space there, it didn't stack up in our global portfolio of opportunities. But we did drill a well that encountered oil in the Kaieteur block, so we think we've helped derisk it for the remaining players. Canje block — we still hold equity in that, we're still the operator. I think it's three wells we've drilled in the Canje block. So we've taken the data from those wells, we're revisiting the seismic and figuring out is there another prospect to drill? Can you talk about your new state-of-the art offices here? These are deploying the latest digital technologies, particularly control room technologies. The fact that we pre-invested in a fibre optic network, so a loop to line that goes from onshore through the offshore fields and then back again, to enable us to transmit information in huge quantities, but also to have very little latency in those communications, which you'll probably understand for control room operations is critical. [Floating production storage and offloading unit (FPSO)] Liza Destiny is not connected to the fibre optic, but all of the subsequent FPSOs either are or will be, and that enables them to have an onshore remote operation. Starting from April, we'll start getting those control rooms up and running and, more gradually, migrate the control room operators from offshore to actually operating 24/7 from onshore. What are the lessons that can be learned from Guyana? The partnership between the government and the operating companies is essential. Having a long-term perspective, creating a shared vision, and then working together to achieve it. That has been one of the strengths in Guyana. Then it's the partnerships that live within the industry, or the prime suppliers, the local suppliers with the overseas expertise, bringing all of that together. What about natural gas? We always have kept an eye on the value and opportunity space with the associated gas on the oil fields, but the first priority has always been to ensure that we're maximising the overall recovery of resource. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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