Gas From Russia Does Not Arrive In Mexico
Russia wants to supply Mexico with LNG - but the offer remains unanswered. The reasons for this are geopolitical, economic and historical at the same time.
The fact that gas from Russia is not reaching Mexico is less due to technical hurdles than to the political and economic reality, in which Moscow has long since lost touch.
In the current situation, the hope of opening up new sales markets with energy exports seems like a reflex from better times. At this year's St. Petersburg International Economic Forum, a Russia with its back to the wall was revealed. Revenues from fossil fuels are falling, exports are collapsing and state finances are coming under pressure. The sanctions are working like a noose that is slowly tightening and taking the country's breath away The sanctions are working like a noose that is slowly tightening and taking the country's breath away. It is not a quick and merciful death by breaking the neck, but a slow suffocation as if by a garrotte.
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Revenues from Russia's most important export goods continue to shrink. Estimates by the research institute SIPRI show a 65% slump in arms exports last year. According to CREA, revenues from fossil fuels also fell by a further three percent in May and are now 45 percent below the level before the Ukraine invasion in 2022, the lowest level since the start of the war. LNG accounts for only seven percent of total export revenues and has fallen by over 50 percent since 2022.
Moscow offers LNG - Mexico does not respond
In view of these developments, Russia is looking for new customers. Energy Minister Sergei Tsivilev declared at the forum that Russia is prepared to supply Mexico with LNG. The Russian embassy in Mexico City also disseminated this announcement on Platform X. But things remained quiet in Mexico. The Ministry of Energy did not comment, and Minister Miguel Ángel Maciel Torres also remained silent. Mexican media did report on the offer, but without any discernible enthusiasm. An offer that Mexico is happy to turn down.
Russia wanted to supply liquefied natural gas to Mexico back in 2005. The plan was to export LNG from the Sakhalin-2 project. A total of 37 million tons were to be shipped to Mexico over a period of 20 years to supply four terminals. The aim was to establish Mexico as a hub for Russian gas, also with a view to deliveries to South America from 2008. But the plan failed. None of the planned terminals were built and not a single delivery was made.
LNG deal with Mexico failed back in 2005
In the meantime, the question arises as to why Mexico should import gas from so far away when there is already a cheap and simple solution right on its doorstep. The United States produces enough gas, which is delivered directly to the south via pipelines. Today, these supplies cover around 72 percent of Mexico's gas requirements, with around 212 million cubic meters flowing every day. No complex infrastructure is required to land LNG from Siberia by ship and convert it back into gas.
The world of 2025 is different from that of 2005. Russia is increasingly isolated internationally. In the USA, a president is in power who is urging other countries to buy American products and is also putting pressure on Mexico. At the same time, Mexico is building up its own capacities to export LNG. New Fortress Energy's Altamira terminal began its first exports in 2024, and Sempra's Energía Costa Azul project will soon follow. Both use gas from the USA, which is supplied reliably and cost-effectively via pipelines. Mexico is looking towards Asia, where demand for LNG is growing. There is no longer any room for Russian gas in these plans. Mexico is no longer a potential customer, but a competitor.
Gas project remains an illusion from Moscow
The Russian LNG offer to Mexico is an attempt without any real prospects. Mexico does not need gas from Russia, but now exports gas itself, based on supplies from the USA. Russia is looking for new markets, as exports to Europe have plummeted and the economy remains reliant on fossil revenues. However, logistics remain costly and the geopolitical conditions are unfavorable. Mexico is clearly leaning towards the United States. The story of 2005 is repeating itself. There are big announcements, but no implementation. The push from Moscow looks more like a sign of desperation than a realistic offer.