An exuberant Andrés Manuel López Obrador celebrated on July 1 the anniversary of the electoral tsunami that brought him to power as Mexico's president, but at least one fly was hovering over the ointment of joy.

Amid the thousands massing in support of their leader amid music, laughter and song on the enormous public square of Mexico City's Plaza de la República, generally known as the zócalo, the fly emerged as a routine news story in El Economista.

The report may have dampened the festivities as it noted the popularity of López Obrador has slumped by as much as 20% to slightly more than 60% in recent weeks, based on a survey by Consulta Mitofsky.

Political pollsters do not have a good record in Mexico, possibly because more than seven decades of authoritarian government have led many citizens to avoid voicing their true political inclinations to strangers. In addition, the results were rejected by other pollsters.

Mitosky has made polling errors in the past, but it is, in the highly specialized world of political polling in Mexico, an important reference point, arguably the Mexican Gallup.

Another fly also buzzed over the festivities in the zocalo. During a speech that ran to almost an hour and a half, López Obrador scarcely mentioned the energy sector, a subject that has raised considerable controversy.

Indeed, he and his supporters have been near-obsessive in criticizing the policies of former President Enrique Peña Nieto, architect of the 2013 energy reform.

The $30 billion budget allocation for state oil company Petróleos Mexicanos (Pemex) reflects that obsession, according to critics of the president, and it has led to severe cuts in areas such as public health and the arts.

However, perhaps the absence of any more than a passing reference to energy policy could be attributed to timing. Within days, Pemex is due to present a business plan, long awaited by ratings agencies and investment banks interested in how the finances and its $106 billion debt are to be resolved.

While the president made merry with his supporters in the zócalo, he earlier met with senior editorial staff of La Jornada, the national newspaper that has long been a supporter of his political causes. The meeting led to an interview published on the day of the zócalo event.

People are content with the change in government, he said.

"More than content -- they're happy," he said in the interview. The president admitted that there is "a lot of resistance" in the state bureaucracy to the new austerity measures, " but there's a bit of bluffing in all of that."

López Obrador said production declines have been reversed in Pemex. In fact, May crude output was almost the same as in the previous month -- and in the state power utility, Comisión Federal de Electricidad (CFE).

Many analysts insist, though, that the CFE  is short of natural gas for power plants, particularly in southern Mexico, not least because of delays in constructing import pipelines from the United States.

The economy, López Obrador told La Jornada, is doing fine, despite projections by independent analysts of a growth rate of only 1% this year.

"Why do I say that the economy is going well?" he asked rhetorically. "It's because there is well being, because there is no corruption, no inflation, and the peso is stronger. What else do we need? Growth. That takes time but our adversaries are betting that there won't be any growth. I maintain that there will be."

The growth will respect Mexico's environment, the president said. Hence, he said there would be no natural gas development using hydraulic fracturing “or the use of transgenic seeds to achieve self-sufficiency in food crops. We won't aim for growth at all costs."

Fracturing, commonly combined with horizontal drilling to squeeze more oil and gas production from tight resources like shale, has been practiced for years in Mexico as it has in the United States. Indeed, Energy Minister Rocío Nahle has stated that the fracturing technique is to be used with safeguards that are most commonly used in most countries.

‘Predatory Mentality’

López Obrador was asked about his relationship with the private sector. "Relations are good," he said, "but we don't agree on everything. It used to be that [the private sector] gave the orders. The energy reform was made for their benefit.

"Indeed, the whole of the state bureaucracy was sequestered by people in business. In fact, many of them weren't business people, but simply people who peddled influence. What they did with the gas pipelines was something that wouldn't be allowed anywhere else in the world."

The companies that built the pipelines to transport gas from the United States to Mexico, he said, "were given 20-year contracts. If a contract cost $1 billion, we ended up paying $8 billion.” On top of that, he claimed, the government had to pay fines when protesters blocked construction.

"Fortunately," he said, "not all the investors had this kind of predatory mentality."

The president's sharp criticism of the business community is usually reserved for sympathetic audiences like La Jornada. The business community does not appear to agree.

"I meet with a lot of business people," former foreign minister Jorge Castañeda said on a recent edition of La Hora de Opinar, or Opinion Hour, on the Televisa network, “and not one has told me that he backs the president's policies."

More than two decades of campaigning for the presidency have steeled the resolve of López Obrador in furthering his political ambitions, but his success in achieving that goal has molded his character with a strong streak of pragmatism, Mercury analyst Arturo Carranza told Mexico’s Daily GPI.

Faced by punitive trade tarriff threats by the Trump administration López Obrador agreed -- to the horror of many Mexicans -- to defend the U.S. border from a perceived threat of an invasion of undocumented immigrants from Mexico and Central America. That kind of pragmatism could well be displayed in the energy sector when targets set for Pemex and the CFE are not achieved.

"Within a year our two, if the targets can't be met, and almost all analysts believe that they won't, the president will show his pragmatic streak,” Carranza said. "That would probably mean achieving the goals with the aid of the private sector through a massive program of farmouts and, of course, auctions under the terms of the energy reform.” 

Meanwhile, Pemex said as of July 1 it has restructured its subsidiaries. Upstream arm Pemex Exploración y Producción has absorbed Perforación y Servicios, which was born in the wake of the 2013 energy reform to provide drilling services for a boom in private sector activity that was expected but has not yet emerged.

Similarly, Pemex downstream arm, Pemex Transformación Industrial has absorbed Pemex Etileno, the ethylene subsidiary.

Pemex said the changes represent "an important step in the integration of the value chain under one single company." In addition, the changes consolidate "austerity measures that will reinforce Pemex by providing benefits in terms of management and operations."