Economy

Could Mexico sing El último adiós to the Havana-Caracas Axis?

Mexico is exploring a devious plan to eat Venezuela’s Petrocaribe lunch, potentially breaking one of the last pinche bastions of diplomatic support Caracas has left.

Juan Carlos Gabaldón

Mexico, our greatly underestimated northern friend, just came up with a brilliant gambit to pry Venezuela away from Cuba’s vise-like grip on our country.

According to Gabriel Sargardter’s latest post for Reuters, the 11th biggest oil producer in the world is discussing a plan to replace Venezuela as the main oil supplier to the fifteen Caribbean and Central American nations currently forming Petrocaribe, the cornerstone of Hugo Chávez’s oil-diplomacy and one of the main reasons the the Organization of American States (OAS) hasn’t been able to reach consensus to condemn Venezuela’s descent into dictatorship.

No manches güey!

Although still in the idea stage right now, the plan could deal a devastating blow to the already weakened Venezuelan diplomacy, while earning Mexico vital hemispheric support for its future interests, including during a highly contentious NAFTA renegotiation with Canada and the U.S.

“Petrocaribe nations’ loyalty to Venezuela has prevented Mexico and allies from winning enough votes to censure Venezuela in the Organization of American States diplomatic bloc.

Even though the plan is in its infancy and may not come to fruition, talk of it could chip away at Maduro’s already weakened support. It is also a fresh example of Mexico leading U.S.-backed, Latin American efforts against Maduro’s government.

Mexico has ditched years of hands-off foreign policy to helm the push against Caracas in the hope that its efforts will be recognized during the crucial renegotiation of the North American Free Trade Agreement, U.S. and Mexican officials say.”

Venezuela and Mexico share a long history providing cheap oil to Caribbean and Central American nations. From 1980 to 2008, both countries teamed up through the San José Accord to jointly supply 11 countries with subsidized oil. Súper buen pedo.

But since Petrocaribe was created in 2005 by Chávez, Venezuela took the lead, claiming those nations’ political support.

However amid economic collapse, Venezuela’s found it increasingly hard to supply the oil required to guarantee that support. From the 121,000 barrels per day (bpd) that Chávez supplied in 2012, Maduro could only offer 28,000 bpd last year; preparing the ground for Pemex to fill the space left by PDVSA.

“At this stage, it was unclear if the scheme would borrow from the San Jose Accord, or be an entirely new mechanism, the sources said. Nonetheless, last week, PMI, the trading arm of Mexico’s state-owned oil company Pemex, drafted a document outlining the main contours of that accord.

It was not clear why PMI wrote up the document, which was seen by Reuters, but a former government energy official said PMI would be the most likely entity for oil diplomacy. A Pemex spokeswoman declined to comment on the document but said the company was “always looking for opportunities.”

Coming just a few days after Mexican Chancellor, Luis Videgaray visited Cuba looking for a solution to the Venezuelan Crisis; this plan would be the clearest sign of the leading role Mexico is taking in the diplomatic struggle against the Venezuelan regime, a role Mexican authorities seem uncharacteristically proud of:

“The United States has been looking at ways of replacing Petrocaribe since at least 2015, according to an external White House advisor who spoke on condition of anonymity.

However, one of the Mexican officials rejected the idea that Mexico was doing the bidding of its top trade partner.

“It wasn’t the United States’ idea,” he said. “It’s ours.”

The taco might have found a way to actually help the arepa while also consolidating itself as a regional power, so… Viva México Cabrones!

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