Mexico to Stop Exporting Oil in 2023 in Self-Sufficiency Quest
1st domino? Will they actually pull it off?
Mexico and the Land Use Model
Re: Mexico and the Land Use Model
It is difficult to see how this theory plays out in the real world. The concept is obvious--keep your oil for your own people. The concept in practice is...complex. Oil production does not happen in a vacuum. Without the global economy to provide equipment, finance, expertise, etc how long would a country's oil production remain stable? At the point that oil producers are keeping it all for themselves the global economy is gone. What good is oil production in that case anyway? If Mexico keeps its oil what will it use the oil for? To run farm equipment that can't be repaired without parts from John Deere?
Re: Mexico and the Land Use Model
Complex indeed. Mexico isn't closing itself off from the world at large, it can still import goods and it's economy is intertwined with that of the United States and Canada. The imports and exports as a percentage of GDP only account for 23.5% of the American economy. A very large number with many specialized parts, but excluding China, Canada and Mexico both are America's largest trading partners. And vice versa, Canada and Mexico's largest trading partners are America and each other in that order.
Latin American markets, with rare exceptions like Cuba, will likely remain relatively open to all 3 countries too as long as the United States exists as a regional power (not even necessarily a superpower) due to the Monroe Doctrine. The Organization of American States is still influential throughout most of the Americas.
My conclusion going down this train of though is that as peak oil progresses and globalism fades I personally expect North and South American markets to become more intertwined and drift from global markets. I don't know what this will look like in other regions and don't claim to, I've not researched their geopolitics as much.
In terms of smaller non-oil producing countries running low/out of fuel to run their industry with within the western hemisphere. I imagine that America will dominate trade as it has and become a new center of manufacturing once it becomes untenable to rely on China and Asia for one reason or another. Manufacturing I think will become more widespread across the Western Hemisphere at large and there will likely be an exchange of fossil fuels that are available for as long as is tenable for manufacturing and other resources vital to the economy like rare earths, lithium, etc.
Once that exchange no longer becomes tenable many countries that aren't producing fossil fuels, if this new age of protectionism keeps taking hold, will face intense industrial degrowth like has been seen in Cuba since the Soviet Union collapsed. (Though industrial degrowth will be present in all economies even when not as pronounced.) That said, all 3 of the major North American economies are oil producing for now, and America specifically has coal reserves to last some time after that. If manufacturing returns to these economies they will be better prepared for that scenario in however many decades it takes to get there. I don't think 100% autarky will take hold in any of the big 3 North American economies though, it will still be lucrative to trade for rare-earths and other natural resources that can't be produced at home into the foreseeable future, especially when other countries that aren't fossil fuel producers can't readily access cheap oil anymore.
In conclusion though I do agree that oil production doesn't happen in a vacuum and reducing or eliminating exports will cause industrial and trade problems eventually for the country that is instituting trade restrictions. But these policies aren't focused on the abstract long term. The political reality is that Mexico is trying to ensure its needs are met in the short term and this is the consequence of that.