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Could Mexico Save Kiev (and the Rest of the World) From War?

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The answer is maybe if energy has anything (read everything) to do with it. Specifically natural gas, which the Russians have used as recently as 2009 as leverage against Ukraine and the rest of Europe who heavily rely on Russian natural gas for roughly 30 percent of their supply.

Since 2009, the last time Russia initiated severe drops or complete cut-offs of natural gas to Ukraine and the rest of Europe, Ukraine has tried to diversify its energy consumption to become less reliant on Russian natural gas. Russian natural gas, however, still remains the economic Achilles' heel of the nation. Many of Ukraine's current economic woes stem from struggles keeping up with past debts owed to Russian energy (via Gazprom) and even Russian price gouging practices that helped keep Ukraine fragile.

As late January's stock markets reeled on the news of another possible energy crisis in Europe, the United States pledged one billion dollars in energy aid to Ukraine to hedge against the crisis. While the news came as a shock to no one, as the United States and the rest of Western Europe try to find a diplomatic way out of this mess, many might wonder, "Why give Ukraine aid at all? Why not just send them what the need? Raw energy. In the form of natural gas, coal, oil, etc." The answer lies with the Department of Energy.

Currently, the DOE restricts the sale of Liquid Natural Gas (LNG) to nations the U.S. doesn't have an extant free-trade agreement with already. And though the United States is the largest producer of natural gas in the world, it only sells to a handful of countries outside of our current free-trade agreements.

Enter Mexico, whose government recently overhauled its energy policy to allow foreign companies to share production and profit-sharing ventures within Mexico, and there seems to be a backdoor solution of sorts to the U.S. DOE restrictions on selling LNG directly to Ukraine.

Though Mexico itself consumes more natural gas than it produces right now, it wouldn't be wildly speculative to think that Pemex, and it's natural gas subsidiaries, might be able to access new, untapped resources under Mexico's new energy laws. But that actually might be beside the point. Who is to say that Mexican energy can't trade, without hinderance, to Ukraine directly? It's possible. And maybe probable if American LNG funneled through Pemex's subsidiaries to Ukraine is completely legal. There's money to be made from it, for sure. And in hindsight, this profit and production sharing scheme in Mexico seems awfully convenient given the circumstances.