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U.S. Gas May Be One Trade That Survives Trump’s Mexico Clash

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It could take more than a political standoff between President Donald Trump and Mexico to keep U.S. shale gas from flowing south.

While Mexico works to reverse declining oil and gas production, the nation’s burning record amounts of natural gas pulled from tight-rock formations north of the border. Pipeline deliveries of the fuel from the U.S. have more than doubled in the past two years, and Mexico’s now tied with Chile as the biggest buyer of tanker shipments of U.S. liquefied natural gas leaving Louisiana’s coast.

The gas exports stand in sharp contrast to the showdown threatening one of the world’s biggest bilateral trading relationships. Mexico’s President Enrique Pena Nieto canceled a meeting with Trump Thursday after the U.S. leader blasted him on Twitter for refusing to pay for a wall along the countries’ border — and now Trump’s considering a 20 percent tax on Mexico imports to pay for it. Gas exports, seen as supporting jobs in the U.S. while handing Mexico cheap fuel, could end up being one trade that bucks the political maelstrom, according to ING Groep NV and Pira Energy Group.

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Written by Naureen Malik

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