Mexico became the first country to nationalize its entire petroleum industry in 1938. President Lázaro Cárdenas ordered the expropriation of foreign-owned oil companies on March 18, 1938.
The action followed a labor dispute in which oil companies refused to comply with a Mexican Supreme Court ruling on workers’ wages and conditions. Cárdenas invoked Mexico’s constitutional authority over subsoil resources and transferred the companies’ assets to the state. The decision caused international controversy and a boycott of Mexican oil, but public support helped the government maintain the policy.
The nationalized assets formed the basis of Petróleos Mexicanos, or Pemex, which was established later in 1938. Mexico’s action is different from Iran’s 1951 nationalization of the Anglo-Iranian Oil Company and Venezuela’s later creation of PDVSA. Those events are related examples, but Mexico’s 1938 expropriation came earlier.