Mexico’s Congress sounded the starting gun this week for a rush of potentially billions of dollars in oil and gas investment when it passed energy reform legislation that would let foreign companies operate there for the first time since 1938.U.S. businesses are poised to benefit, as the state-owned Mexican oil giant Pemex advocated for the monopoly-busting measure as a means to tap onshore shale plays and deepwater deposits in the Gulf of Mexico.The amount of investment in the Mexican side of the Gulf could be “a factor of 10” greater than what’s been spent on the U.S. portion, said...

The great controversy playing out over oil reform this month in Mexico will be central to Mexico’s economic future. Can declining oil production be turned around in order to support an expanding industrial economy rivaling the BRICs and become a global manufacturing hub? This oil reform is so important for Mexico that it is the number one plank in President Enrique Pena Nieto’s “Pact for Mexico” modernization program.The outcome also matters a lot to the United States, both as a top trading partner and in terms of whether economic growth in Mexico will reduce illegal immigration and pressure on...