70% of Mexico's Energy Comes from the U.S.: A Look at North America's Powerhouse Trade Ties

When I first looked into North America's energy trade, I was struck by how different it's from the continent's other major industries. Unlike the more unified systems seen in automotive or agriculture sectors, energy operates on a unique dual relationship model. It's not a single, integrated entity but two powerful bilateral relationships that move massive amounts of vital resources across borders. But does this setup need a change, or is it a finely tuned engine humming along just as it should?

The Mechanics of North American Energy

Diving deep into these energy flows, it's clear that Canada and the United States form one of the world's most significant oil partnerships. About 60% of all oil imports into the U.S. come from Canada, making it a critical supplier. On the other hand, the energy link between the U.S. and Mexico is powered by natural gas. An astonishing 70% of Mexico's energy needs are met by natural gas imports from across its northern border. These numbers aren't just statistics. they're the lifeblood of economies and industries.

Howard Energy Partners CEO Mike Howard and former Canada Energy Regulator CEO Gitane De Silva highlight just how indispensable these connections are. And as USMCA negotiations are on the horizon, the consensus among energy executives, regulators, and policy experts seems unified. The current arrangement, they say, works remarkably well. It might just be that the best move is no move. But is there room for crypto to play a part here?

Implications for the Market and Beyond

What does this mean for the energy markets? For one, these strong bilateral ties ensure a certain level of stability in supply and pricing, which is important for economic planning. But here's the thing: the very structure that supports stability could also be ripe for innovation through crypto and blockchain technology. Imagine tokenized energy credits or using blockchain for more efficient cross-border settlements. The real world is coming on-chain, one asset class at a time.

The opportunities are vast. Energy companies could reduce costs and increase transparency by embracing blockchain. Consumers could benefit from more competitive pricing and a clearer understanding of where their energy comes from. But one might wonder, will these changes catch on, or will old ways persist out of sheer inertia?

What Should We Do About It?

So, what's the takeaway here? For policymakers and companies involved in North American energy, the priority should be to maintain the stability of these relationships while exploring technological advancements that could enhance them further. Tokenization isn't just a narrative. It's a rails upgrade for industries that have relied on traditional systems for too long.

For those in the crypto space, the lesson is clear: focus on real-world applications where physical meets programmable. Energy trade, with its massive scale and importance, is an area where blockchain could genuinely revolutionize processes. The stablecoin moment for treasuries might just find a counterpart in energy when handled correctly.

In the end, whether we're talking about oil or natural gas, the enduring strength of North America's bilateral energy trade ties isn't just about what's currently moving across borders. It's about what could be. And that potential is where the future of both energy and crypto may very well lie.