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Cross-Border Energy Ties Strengthen As Trump Promises Trade Overhaul

One energy researcher says the Trump Administration probably wants to be careful about shaking up cross-border trade when it comes to energy.



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The Trump Administration says it wants to work out its differences with Mexico over paying for a border wall, but the president's tough talk has still strained relations between the two countries. That’s being watched in Texas, where cross-border energy ties continue to strengthen.

The federal Energy Information Administration says the U.S. has exported more and more gasoline to Mexico in recent years, and that trend is likely to continue.

For refineries on the Gulf Coast, that’s great news.

“Houston has become the de-facto refinery for Mexico,” says Jorge Piñon, Director of the Latin American and Caribbean Energy Program at the University of Texas. He says the city’s refineries export close to 500,000 barrels per day of gasoline and clean diesel to Mexico.

According to Piñon, refineries in Mexico just haven't been able to keep up with gasoline demand because of a variety of maintenance and capacity problems, so the country has been importing more from the U.S.

But President Trump has promised to re-work cross-border trade, calling the North American Free Trade Agreement a "disaster."

Despite the tensions, Piñon says the new administration probably wants to be careful about shaking up trade when it comes to energy.

“If by any chance we strain that relationship, Mexico then turns to buy its gasoline needs from another supplier – guess who’s going to suffer?” Piñon asks. “It’s going to be American jobs.”

While "America First" was a big Trump promise, so were "jobs, jobs, jobs", and here in Texas, some of those jobs depend on healthy ties with Mexico.