AMERICANS SOMETIMES wonder why this country's relations with Mexico are getting increasingly sour. There have been contributions enough from the Mexican side. But as a piece of truly inept diplomacy, you could hardly find a better example than the State Department's statement yesterday on Mexican oil prices.
The Mexicans had just raised the price of their crude oil from $24.60 to $32. The State Department huffed that the increase "is unjustified and we deeply regret it." You could say with accuracy that everything that has happened to oil prices since 1973 is, from the buyers' point of view, regrettable. But as long as American buyers scramble to buy the oil at the high new prices, it's hard to argue that, from the sellers' point of view, those prices are unjustified.
Suppose that you were the official in charge of setting the price on Mexico's oil. Probably you would look at the prices that your American customers pay to other producers. For the past couple of months American refiners have been bringing in Venezuelan oil at spot prices that have ranged well over $30 a barrel. Canada currently exports only heavy grades, which are cheaper than average, but that oil comes into the United States at $26.50 a barrel plus transportation costs. Under the Canadian formula the light grades, comparable to Mexico's, would be well over $30.
Closer to home, the U.S. government itself is selling oil from the Elk Hills Naval Reserve in California. Price controls do not apply to the Elk Hills oil. Last month it was going for $33 a barrel and up. A few days ago, in the latest auction, the top bid was $41 a barrel.
With U.S. government oil going at that terrific price, might not the Mexican government reasonably conclude that $32 for Mexican oil is not excessively high? If Americans will pay themselves a very high price for oil, why should Mexico -- which is not, after all, a wealthy country -- sell it to them for far less?
It is foolish for the U.S. government to try to jawbone down the international prices of oil. Three successive administrations have intermittently tried it, with uniformly poor results. All of this deploring and protesting and regretting has no effect whatever on prices. But it offends and dismays other governments, like Mexico's, to which the United States seems to be asking concessional prices at levels that are, for those governments, politically impossible.
The State Department's regrets aren't going to keep prices down for consumers. Only one remedy will work. That is concerted and immediate action by all of the industrial countries to reduce their oil imports. Rather than reproaching the Mexicans, the Carter administration might more usefully turn its attention to a steep tax on gasoline consumption in the United States.