Economics: New energy sector regulations open doors to private investment, but the legal uncertainty is too off-putting
Decrees that appeared in the October 3 Official Gazette of the Federation contain regulations for six secondary laws in the energy sector: the Energy Planning and Transition Law, the Hydrocarbons Sector Law, the Electricity Sector Law, the Biofuels Law, the Geothermal Energy Law, and the Hydrocarbons Revenue Law. Their main objective is to strengthen the sector by expanding the productive capacity of Pemex and the CFE with the participation of the private sector in various projects of both companies. The laws also seek to transition in an orderly and effective manner to the generation of clean energy.
However, there are doubts as to whether opening up to the private sector will attract significant investment. Obstacles remain, such as legal uncertainty in the event of disputes over the fulfillment of contracts between public and private companies, as well as the prevalence of the CFE in the electricity sector. This week’s Outlook analyzes the most important regulations in the areas of energy planning and transition, hydrocarbons, and electricity, as well as their main implications.
Among the indicators released in the past week, it was reported that in August 2025, industrial production extended its slide, declining 3 basis points compared to July and an annual -2.7%. Through the first eight months of the year, industrial activity was off -1.4% yoy. Meanwhile, annual consumer inflation was 3.76% in September, up from 3.57% in August, due to 12 month non-core inflation's rising 64 basis points above the previous month’s reading. Core inflation also continued to rise and remained above Banxico's tolerance range; the month’s 4.28% rate is the highest since April 2024 and well above where the CPI concluded last year.
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