Peru political risk: new president vows security crackdown as investment questions grow

Peru's new president Jose Jeri

Peru political risk is rising as Jose Jeri takes power amid crisis. The shift heightens Peru political risk for mining and energy investors. However, Jeri promises stronger institutions while prioritizing a fast security response nationwide.

Security vows meet a fragile economy

Jeri pledged to defend the constitution and restore order immediately. He called gangs and criminal groups Peru’s “main enemies.” Meanwhile, protests and strikes exposed deep frustration over crime and governance. Congress removed Dina Boluarte for “moral incompetency.” Her approval hovered near 4pc before impeachment.

What it means for mining and energy

Security instability threatens project timelines and logistics. Authorities also battle illegal mining and fuel theft. Peru produced 48,000 b/d of crude in July. Natural gas output reached about 1.4 Bcf/d in July. However, investment momentum remains uncertain as policy signals evolve. Peru political risk therefore extends to permits, transport, and community relations.

The cabinet now faces urgent coordination with Perupetro and Petroperu. Boluarte had floated direct crude trade with Petroecuador. Yet the plan lacked detail and regional confirmation. As a result, commercial clarity remains limited for refiners and traders. Investors should map security-sensitive corridors and revise risk pricing.

Market participants must monitor congress dynamics and street sentiment. Jeri’s mandate relies on rapid, visible crime reductions. Supply chains may still face disruptions during enforcement surges. Consequently, contingency routing and inventory buffers look prudent for miners and fuel importers. Peru political risk will hinge on credible security wins.

The Metalnomist Commentary

Security-first politics can stabilize logistics if execution improves quickly. Yet delayed investment decisions are likely until fiscal, policing, and energy policies align. We expect risk premia on Peruvian offtake and transport to stay elevated near term.