Why the US Needs its Neighbors for Energy
Bloomberg 2026-06-28 12:04:23
Context: The energy trade in North America is a complex system, with the US relying heavily on its neighbors, Canada and Mexico, for energy supplies. The current arrangement, which involves bilateral relationships between the countries, has been deemed to be working remarkably well by energy executives, regulators, and policy experts. As negotiations for the US-Mexico-Canada Agreement (USMCA) approach, there is a growing consensus that the energy trade should be left largely untouched.
Key Facts
- North America's energy trade operates through two powerful bilateral relationships: Canadian oil flowing south into US refineries and American natural gas powering Mexico's economy.
- Roughly 70% of Mexico's energy comes from the United States, according to Howard Energy Partners CEO Mike Howard.
- About 60% of US oil imports originate in Canada, as noted by former Canada Energy Regulator CEO Gitane De Silva.
- The current arrangement has been deemed to be working remarkably well by energy executives, regulators, and policy experts, who believe that it should be left largely untouched during upcoming USMCA negotiations.
- Unlike autos or agriculture, North America's energy trade does not function as a single, integrated three-country system.