- OPEC+ finally struck a deal to reduce oil production after the U.S. offered to take a share of Mexico’s supply cuts.
- Donald Trump hinted in a press conference that the Mexican government would reimburse the United States.
- Could the White House leverage this into an opportunity to help pay for the border wall?
Long after it appeared Donald Trump had lost all hope of fulfilling his promise to force Mexico to pay for his beloved border wall, a new opportunity has emerged.
Mexico suddenly owes the U.S. a hefty favor after the latest OPEC+ meeting, and we all know the favor Trump will demand.
Trump Boasts Mexico Will “Reimburse” U.S. for Supply Cuts
After painstaking negotiations, OPEC finally agreed to a supply cut to try and boost a tumbling oil price. The deal looked like it might collapse when Mexico balked at the scale of the supply reduction – until the United States offered to cover a portion of Mexico’s share.
OPEC wanted Mexico to cut 400,000 barrels a day, and the U.S. – which is desperate to prop up energy prices due to its status as the world’s largest producer – agreed to cut its daily production by 250,000 bbls on top of Mexico’s proposal of 100,000.
As a self-proclaimed artisan dealmaker, it seems unlikely that President Trump will let this one slide without leveraging Mexico’s debt into a political victory.
The Border Wall Is Still Growing – at $20 Million a Mile
Speaking at the coronavirus task force meeting, Trump made it clear he intends on calling in this favor in the future:
The United States will help Mexico along, and they’ll reimburse us some time at a later date when they are prepared to do so.
It is likely not a coincidence that the border was all Trump talked about in the lead-up to his comments about the supply cut.
He claimed it’s currently 168 miles long, which would suggest progress is rapid as there were only 93 miles complete in December.
So will he put the pinch on Mexico to pick up the tab? Unfortunately for the president’s defenders, probably not.
Current estimates for the full wall are as high as $11 billion, which means about $20 million a mile.
The tourism and energy reliant Mexican economy is in dire straits – which is why they resisted oil production cuts. Much like the United States, Mexico is struggling with a massive wave of layoffs amid coronavirus-related shutdowns.
Trump Has a Great Relationship With AMLO
President Andrés Manuel López Obrador (AMLO) apparently has a great working relationship with Trump. During today’s press conference, Trump had plenty of warm words for his Mexican counterpart.
If Trump could get Mexico to pay for even a brick of his border wall, it would be a tremendous PR victory for a White House desperate to fulfill campaign promises ahead of the 2020 election.
But given the state of Mexico’s finances, it looks improbable that he’ll secure anything more than a token gesture.
Disclaimer: The opinions expressed in this article do not necessarily reflect the views of CCN.com.
Last modified: September 23, 2020 1:48 PM