Oil in Mexico is not only an important source of revenue for the Mexican government, it’s also a source of national pride. In 1938, on a day still celebrated today as Oil Expropriation Day, the Mexican government seized control of its oil from foreign companies and put production in the hands of state-owned Petróleos Mexicanos (Pemex). But today, with dropping oil prices, global competition, corruption within Pemex and rampant theft, oil production in Mexico is tanking.

This is why in 2013 President Enrique Peña Nieto decided to drastically reform the energy sector by allowing foreign companies to compete with Pemex for Mexico’s oil production. And it’s also why his decision has been met with such furious debate and opposition. Today, as Mexico begins auctioning off state-owned oil fields to oil giants from around the world, some are optimistic about the growth prospects of foreign investments. However, with President Nieto facing a 14% approval rate according to Dalia’s survey, it is unclear how well the Mexican population will accept these developments.

In order to keep up with the debate, Dalia is running a monthly survey in Mexico to track public opinion of President Nieto and his plan to privatize parts of Mexico’s oil industry. The first survey, launched in mid June 2017, was conducted on a representative sample for the online population aged 14-65 of Mexico and included 540 respondents.

A slight majority (56%) of Mexicans disapprove of how state-owned Pemex is handling production: 34% think Pemex is handling production well and 10% don’t know. When it comes to the energy reform, the population is also divided: 41% think the energy reform is a good idea, 35% are undecided or don’t know, and 24% think it’s a bad idea.

 

Though people aren’t happy with Pemex, they still think that oil production is a good thing for the country. Overall, Mexicans think the industry is beneficial because it is an important part of the economy (64%), is good for jobs (55%), and that it makes Mexico independent from energy imports (41%). In fact, Pemex has been a major source of revenue for the government, with a majority of it’s profits going straight to the government budget. On the other hand, 61% say a disadvantage of oil and gas production is that it generates corruption, 42% say it pollutes the environment and 31% say that it contributes to climate change.

 


Given that people are so divided about their feelings towards oil production, Pemex and the energy reform, it also comes as no surprise that they are divided about the solution. When asked who they think should be responsible for oil production in Mexico, 32% of Mexicans think it should be only the state, 30% think it should be mainly the state with limited private company roles, 20% think it should be an equal balance of state and private companies, and 5% think it should be mainly or only private companies. It remains clear that most Mexicans (62%) want the state to continue to play a dominant role. But after 75 years of exclusive state control, it is also remarkable that a slight majority (55%) of Mexicans are ready to invite private companies to play at least a small role.

 


Mexicans are generally angry about the way Pemex is handling oil production. However, when it comes to welcoming foreign companies to Mexico’s oil fields, people are torn down the middle: so far, 29% have a positive opinion of the role that foreign companies role, 32% have a neutral opinion, and 30% have a negative view. As Mexico’s energy reform unfolds over the following years, Dalia will continue to monitor public attitudes in Mexico via our Political Risk Tracker. Get in touch to learn more!