Electrification's Paradox: Cheap Gas vs. Clean Power

Ninety percent of global businesses expect their operations to be largely electrified by 2035. That's the headline from a survey of nearly 2,000 executives across 18 countries, released Monday by the We Mean Business Coalition, E3G, and the Global Renewables Alliance. The polling, conducted in late April as the Strait of Hormuz remained closed, found that 73% expect substantial electrification by 2030, with 79% saying geopolitical instability has made their shift more urgent , according to OilPrice.com.

The timing matters. Ninety-one percent of business leaders say electrification would improve energy security , the survey found. But here's the tension: as companies race to ditch fossil fuels, some of the world's cheapest and most abundant natural gas is flowing across borders at record volumes—making the economics of that transition harder to justify in real time.

Can Mexico Afford to Ignore $3 Gas?

Mexico is Exhibit A. The country's natural gas imports from the United States grew more than twentyfold between 2000 and 2024, from 287.9 million cubic feet per day to 6.4 billion cubic feet per day , according to Ember Energy. At the same time, Pemex's domestic gas production fell 6.3% year-on-year through May 2025 , Mexico News Daily reported.

The result is a deepening dependency that cuts against Mexico's stated goal of energy sovereignty. Approximately 74% of Mexico's total gas demand is now covered by imports, with the U.S. supplying almost all of it , Ember Energy noted. President Sheinbaum has set a target of 5 billion cubic feet per day of domestic production by 2030, but average output through May was 15% below the 4.163 Bcf/d goal outlined in her National Strategy for the Hydrocarbons and Natural Gas Sector .

The problem isn't just volume—it's price. Natural Gas Intel asked the question directly in a Monday headline: are U.S. prices too attractive for Mexico's domestic supply ambitions? With Henry Hub trading at $3.25/MMBtu per million BTU on Monday, according to market data, and Mexico's imported gas costing on average 3.1% lower than Henry Hub over the past 25 years , the economic case for expensive domestic drilling weakens. One analyst told Natural Gas Intel that "the concepts of energy sovereignty and energy self-sufficiency—pillars of Mexico's energy policy—lack a solid foundation" given the supply-demand imbalance.

Why Is the U.S. Betting $1.6 Billion on Gas Infrastructure?

North of the border, the Trump administration finalized a $1.6 billion loan to Michigan utility DTE Energy on Monday to modernize natural gas infrastructure. The loan will upgrade some 800 miles of distribution mains and service lines, a move the Energy Department said would result in more than $700 million in cost savings , Bloomberg reported.

The loan, issued through the DOE's rebranded Office of Energy Dominance Financing, underscores a policy split. The same administration that has rolled back clean energy incentives is now financing gas grid upgrades at below-market rates. DTE will use the funds to rebuild compressor infrastructure used to store natural gas during low-demand periods , according to Quiver Quantitative.

Meanwhile, the Northeast is experiencing what RBN Energy calls a "reawakening" in pipeline development. Williams Companies broke ground in April on the Northeast Supply Enhancement pipeline, designed to transport natural gas from Pennsylvania into New York City and Long Island, with federal officials participating in the ceremony . The NESE pipeline will add 400,000 dekatherms per day of capacity and is expected to serve the equivalent of 2.3 million homes when it enters service in the fourth quarter of 2027 .

Natural Gas Intel reported that pipeline projects to expand connectivity between Appalachia and demand centers are moving forward for the first time in years, including into the previously off-limits New York/New Jersey and New England market areas . The shift follows years of regulatory gridlock and reflects rising baseload demand from data centers and coal plant retirements.

What's Driving Tungsten Carbide Prices Through the Roof?

Electrification may be the goal, but getting there requires materials—and one of them just became a lot more expensive. Tungsten carbide, the ultra-hard compound used in drilling bits for mining and oil and gas exploration, has seen prices surge more than 450% over the past 14 months, according to industry sources.

The Rotterdam ammonium paratungstate benchmark traded at $3,185 per metric tonne unit in April 2026, up 350% year-to-date and about 900% over the past 12 months , The Oregon Group reported. The price rally is being driven by U.S. tariffs, Chinese export controls, strategic defense stockpiling, and limited new mine supply, with China imposing export licensing on tungsten in February 2025 .

The squeeze is acute for miners. International Mining noted Monday that China, the dominant global supplier, implemented strict export controls that reduced overseas shipments by nearly 40% , while China's national tungsten mining quota for 2026 was set at 115,000 tons, an 8% reduction compared to 2025 and the third consecutive year of tightening quotas .

The impact ripples through the supply chain. Downstream demand remained robust across tooling, aerospace, and defense sectors, with additional pressure from military consumption intensifying competition for limited supply , Procurement Resource reported. For mining companies counting on tungsten carbide bits to develop lithium, copper, and rare earth deposits needed for the energy transition, the cost spike is a direct hit to project economics.

What Changed This Week

The electrification consensus hardened. Business leaders across 18 countries signaled they're moving ahead regardless of policy uncertainty, driven by energy security concerns that predate but were amplified by the Hormuz crisis. At the same time, the U.S. doubled down on natural gas infrastructure with federal financing, while Mexico's dependency on cheap U.S. gas deepened to levels that make domestic production targets look increasingly aspirational. And a critical material for resource extraction—tungsten carbide—became scarce and expensive enough to threaten the mining projects that underpin the clean energy supply chain.

What to Watch

Mexico's Pemex is expected to release second-quarter production figures in mid-July, which will clarify whether the company can reverse its domestic gas decline. In the U.S., the Federal Energy Regulatory Commission is reviewing additional Northeast pipeline applications, with decisions expected by late summer. And tungsten markets will be watching China's second-half export quota allocations, typically announced in July, for signals on whether supply constraints will ease or tighten further into 2027.