Increase in Mexican oil exports indicates thawing ties

Observers say Mexican state oil company Pemex's decision to significantly boost oil exports to China will help optimize the imbalanced bilateral trade structure and indicates thawing ties following their leadership transitions.

On the sidelines of the Boao Forum for Asia on Saturday, Pemex Chief Executive Emilio Lozoya said the company would begin increasing exports to China by 30,000 barrels a day starting this month, according to a two-year agreement between Pemex and China's Sinopec, Reuters reported.

The level of exports to China could increase over time as part of the agreement, he added.

Mexico, the seventh largest oil producer in the world, exports nearly 80 percent of its oil to the US and only some 50,000 barrels to China each month, according to China Radio International.

Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times that the increase stemmed from China's potential for growth in demand, against the backdrop of shrinking US imports as a result of its shale boom.

A report released by OPEC last week expected China to overtake the US as the world's largest oil importer by 2014.

This would also diversify China's sources of oil imports, "as only about 9 percent of the imports came from Latin America last year," Lin added.

Data from the China Petroleum and Chemical Industry Federation showed last year nearly half of China's oil imports came from the Middle East.

Yang Zhimin, a researcher with the Institute of Latin American Studies at the Chinese Academy of Social Sciences, told the Global Times that the supply of oil is not solely decided by market demands, given its strategic nature. "We can't rule out the possibility of US influence in Mexico's decision, but the current president Enrique Pena Nieto won't follow the US as closely as his predecessor did."

Pena Nieto, who is from the center-left Institutional Revolutionary Party, last year replaced rightist Felipe Calderon as president.

Yang noted that the visit by Pena Nieto, which was paid just weeks after Xi became president, was a move aimed at mending bilateral ties. His predecessor Calderon met the Dalai Lama in 2011, drawing discontent and objection from Beijing.

Yang said the new oil deal would also help narrow the bilateral trade imbalance. Mexico said its trade deficit with China reached $51.2 billion in 2012.