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Bond Market News
Mexico To Present Restructuring Plan For Pemex Amid Oil Production Downturn
July 2, 2025
Mexico President Claudia Sheinbaum is planning to present a restructuring plan for state oil giant Pemex in the next three weeks. The proposal will come amidst falling oil production and Pemex’s deepening financial concerns. Sheinbaum said that the plan would be a very profound transformation and Pemex’s long-term vision beyond 2040 is in the making.
Pemex has $101bn in financial debt and owes about $20bn to its suppliers and oil field service companies. The company has started slashing its exploration and production spends, has begun laying-off workers and is relying on the government to pay off its creditors. Pemex’s conservative spends have reduced Mexico’s oil output to 1.62mn bpd, the lowest production since 1979. Mexico has not been able to discover oil fields at the same scale of Cantarell and Zama for a long time, which are estimated to have held 35bn and 800mn barrels of oil respectively at the time of discovery.
Meanwhile, US refineries are said to be working overtime to meet the global summer demands. Prices of similar quality oil supply from Mexico and Canada to US fuelmakers have increased on the backdrop of the recent tariff actions, further thinning Mexico exports.
Pemex’s 6.5% 2041s are up by 1.4 points at 75.9, yielding 9.5%.
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