CFE Reports Losses in 2022
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CFE Reports Losses in 2022

Photo by:   Ibrahim Rifath - Unsplash
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Eliza Galeana By Eliza Galeana | Junior Journalist & Industry Analyst - Tue, 02/28/2023 - 11:10

On Feb. 27, 2023, CFE published its financial results for 2022. The state company reported losses for the third year in a row of MX$39.7 billion (US$2.1 billion). However, the loss was considerably lower than that reported in 2021 of MX$106.2 billion (US$5.7 billion). 

CFE stressed that losses were a consequence of the war in Ukraine, which led to an increase in international prices of hydrocarbons, particularly of natural gas used for 22.26% of the national primary energy production. “The fact that Russia is one of the largest oil, gas and coal producers in the world has had a significant impact on prices. This situation affects all industries, especially the energy sector,” the report reads. 

Current prices of natural gas range between US$7/GJ and US$10/GJ, while in early 2021 the price was US$2.5/GJ. Moreover, the report states that fuel exports from the US to Europe are expected to keep energy prices high for the rest of 2023. 

Losses over the past three years also coincide with the implementation of President López Obrador’s energy policies, which favored state companies over private interests. The last time CFE closed with positive results was in 2019, reaching a net return of MX$48.5 billion (US$2.6 billion). By the end of 2020, the company announced losses of MX$85.9 billion (US$4.6 billion).

According to the report, CFE’s numbers remained in red despite a 9.1% increase in revenue in comparison to 2021, which totaled MX$618.2 billion (US$33.7 billion). Of these revenues, MX$441.4 billion corresponded to national energy sales, MX$37.8 to fuel sales to third parties, MX$18.5 billion to energy transport and MX$82.1 billion to subsidies. Subsidies were used by the federal government to absorb the increases that electricity tariffs would have seen, given the context of global increases in prices.

Photo by:   Ibrahim Rifath - Unsplash

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