In 2023, the overall value of energy trade between Mexico and the United States experienced a significant decline, dropping by almost 15% from $77.8 billion in 2022 to $66.5 billion, when adjusted for inflation, according to EIA.
This decrease was primarily driven by lower fuel prices, despite an increase in the volume of energy exchanged between the two countries. The total value of energy trade includes the combined worth of energy imports and exports, influenced by both the prices and the volumes of traded materials.
Decline in U.S. Energy Exports and Mexico's Energy Imports
Data from the U.S. Census Bureau shows that the inflation-adjusted value of U.S. energy exports to Mexico fell by 19% in 2023. Similarly, the inflation-adjusted value of Mexico's energy imports decreased by 6% during the same period.
Crude oil trade
The United States imported more crude oil from Mexico in 2023, with an average of 733,000 barrels per day, a 15% increase from 2022.
However, due to a significant drop in global crude oil prices, the Brent crude oil spot price averaged $82.41 per barrel in 2023, down from $100.94 per barrel in 2022.
Consequently, the overall value of U.S. crude oil imports from Mexico decreased by 4% despite the higher import volumes.
Crude oil accounted for 81% of Mexico's total energy imports to the United States. Notably, the United States did not export any crude oil to Mexico in 2023.
Petroleum products
Mexico remained the largest market for U.S. petroleum products in 2023, largely due to its aging refinery infrastructure, which struggles to meet domestic demand.
As a result, Mexico imports significant quantities of gasoline, diesel, and propane from the United States.
Petroleum products made up 87% of total U.S. energy exports to Mexico in 2023, with an average export volume of 1.2 million barrels per day, a 1% increase from 2022.
However, the value of these exports fell by 9% when adjusted for inflation, decreasing from $40 billion in 2022 to $36 billion in 2023.
Natural gas trade
The trade in natural gas, primarily transported via pipelines, saw the United States exporting a record 6.2 billion cubic feet per day to Mexico in 2023, an 8% increase from the previous year.
Despite this volume increase, the lower prices resulted in a 52% decline in the commercial value of natural gas exports compared to 2022. Natural gas constituted 13% of all U.S. energy exports to Mexico during the year.
Electricity trade
Electricity trade between the United States and Mexico is relatively minor, with exchanges primarily involving California, New Mexico, and Texas.
In 2023, U.S. imports of electricity from Mexico increased by 20% to 5.7 terawatt hours (TWh), while U.S. exports to Mexico decreased by 65% to 1.8 TWh, resulting in a net trade deficit of 3.9 TWh.
The value of energy trade between Mexico and the United States in 2023 was significantly affected by lower fuel prices, even as the volume of energy exchanged increased.
Crude oil, petroleum products, natural gas, and electricity each played distinct roles in this complex trade relationship, with varying impacts on the overall trade value.
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