Pemex Intervention Could Harm Mexico LPG Market, Experts Warn

Plans for Mexico’s state oil company Petróleos Mexicanos (Pemex) to enter the retail liquefied petroleum gas (LPG) business bode poorly for competition, consumers and the company itself, according to local energy sector stakeholders.

President Andrés Manuel López Obrador announced last week that Pemex would launch a subsidiary called “Gas Bienestar” or “Gas Wellbeing” within three months, and that authorities are working to establish a maximum LPG price for consumers.

This would be a major shift in policy, as Mexico liberalized LPG prices in 2017 under the framework of the 2013 constitutional energy reform.

López Obrador is seeking to put a lid on the cost of LPG for households, the leading demand segment for the fuel, amid rising global propane prices. LPG can...