Mexico has begun cutting natural gas supplies to some of its largest customers by as much as 45% of their orders to cope with ballooning demand from households to steelmakers such as Ternium SA (TX) and ArcelorMittal. (MT)
Monopoly supplier Petroleos Mexicanos, known as Pemex, started reductions on a case-by-case basis as the government studies forcing the measure on all companies. Pemex has increased imports from the U.S. to records this year as its state-owned pipelines run at about 95% of capacity.
The bottleneck in Latin America's second-largest economy is the latest energy whiplash stemming from the U.S. shale gas boom. Mexican gas prices are tied to rates in its northern neighbor, where soaring supplies from shale fields drove gas to a 10-year low and reduced Mexico's wholesale price 32% in the past year. Manufacturers can't get enough of the energy. . .View Full Article