Petróleos Mexicanos (Pemex), Mexico’s state-owned oil giant, has announced a staggering US$9 billion loss for the fourth quarter of 2024, a dramatic downturn compared to the profit recorded in the same period last year.
The loss underscores the severe financial and operational challenges plaguing the company.
The disappointing results were attributed to a combination of factors, including increased sales costs, a reduction in the value of fixed assets, and losses related to currency exchange fluctuations.
These issues paint a concerning picture of Pemex’s current financial health.
Adding to the company’s woes, Pemex’s crude and condensate production continued its downward spiral.
Output reached just 1.65 million barrels per day (bpd) during the quarter, a nearly 10 per cent decrease compared to the previous year.
Jorge Alberto Aguilar, Pemex’s corporate planning chief, acknowledged the significant hurdles the company faces.
Aguilar cited operational challenges, working capital deficiencies, and the persistent decline in output.
He stressed the urgent need for a comprehensive recovery strategy in light of the company’s “serious” budget restrictions.
Pemex’s crude output has plummeted to historic lows, a situation exacerbated by the company’s reluctance to pursue equity partnerships and the increasing age of its offshore oil fields, particularly those located in the southern Gulf of Mexico.
Company executives specifically noted declining output from the Maloob and Zaap offshore fields, as well as the Quesqui onshore field.
Despite the significant loss, Pemex did report some positive figures. Revenue for the quarter rose to 436.6 billion pesos (AU$12.1 billion), a 3 per cent increase compared to the same period last year.
Additionally, the company’s tax bill decreased to 45.7 billion pesos (AU$1.2 billion), down from 53.9 billion pesos (AU$1.49 billion) a year earlier.
Earnings before interest, taxes, depreciation, and amortisation totalled 14.6 billion pesos (AU$404 million).
However, Pemex’s financial debt remains a major concern, ending the year at a substantial $97.6 billion.
Debt owed to service providers as of December totalled 506.2 billion pesos (AU$14 billion).
The Mexican government has stepped in to provide financial support, contributing 156.5 billion pesos (AU$4.3 billion) in 2024, with 96 per cent of that amount earmarked for debt repayment.
Furthermore, the government plans to transfer an additional 136 billion pesos (AU$3.7 billion) to Pemex in 2025 to further support debt and loan repayments.
This financial assistance is part of a broader budget proposal aimed at addressing the company’s significant financial liabilities, which include nearly US$9 billion in bond payments due in 2025.
Pemex’s refineries processed 786,000 bpd of crude oil in the fourth quarter, aligning with the government’s stated priority of reducing the nation’s reliance on fuel imports.
