Mexico’s Pemex posts wider third-quarter loss, hit by weaker peso

By Noe Torres and Adriana Barrera

MEXICO CITY (Reuters) -Mexican state-owned oil company Pemex reported a deeper $8.2 billion third-quarter net loss on Tuesday, hurt mostly by a weaker exchange rate.

The company, in a filing with the Mexican stock exchange, posted losses of around $4.5 billion in the third quarter of 2023, but Mexico’s peso currency weakened more than 13% in the year since, according to LSEG data.

While Pemex mostly operates in U.S. dollars, like nearly all oil companies, it uses pesos for most of its local costs.

Revenues for the country’s biggest company during the July-to-September period totaled 426 billion pesos, down by nearly 8% year-over-year due in large part to lower crude export sales.

The company noted that its financial debt for the three-month period totaled $97.3 billion, down by $8.7 billion compared with the end of 2023, according to the filing.

President Claudia Sheinbaum took office at the start of this month, mostly pledging to continue government support for the heavily-indebted Pemex, much like her predecessor.

In its filing, Pemex disclosed it has received 145 billion pesos in assistance from state coffers during the third quarter.

Some close to Sheinbaum have suggested she might be more open to some form of Pemex partnerships with private oil companies in a push to boost production despite the company’s massive debt load.

The new president has said she would target what she has described as a sustainable oil output of 1.8 million barrels per day (bpd).

In its report, the company reported combined crude and condensate production during the quarter of 1.76 million bpd, down about 6% compared with the year-ago period.

Over the years, the company has seen its crude output fall steadily from a peak of 3.4 million bpd two decades ago, sliding in recent months to fresh record lows at under 1.5 million bpd.

($1 = 19.6921 Mexican pesos at end-September)