PEMEX Exports Grow but Self-Sufficiency Goals RemainBy Paloma Duran | Fri, 10/23/2020 - 10:07
PEMEX reports it has increased crude oil exports in 2020 despite lower gains. The increase is not compatible with President López Obrador’s energy plan for 2024 that seeks to reduce oil exports and work toward self-sufficiency by using all oil production for internal consumption.
Nymia Almeida, Moody’s Analyst, said PEMEX will be more vulnerable to exchange rates as a result of López Obrador’s energy reforms. This is because PEMEX’s profits will be in Mexican pesos, while 87 percent of its debt (US$104 billion) is in US dollars and other currencies. Despite federal government efforts to decrease its dependency on oil profits, Mexico will still face a fiscal deficit due to the 2 percent loss in GDP.
Last week, PEMEX Director General Octavio Romero declared that in 2020, the NOC registered the highest level of oil exports since 2018. In August, the company exported 114,300 barrels per day, 163 percent higher than any other fuel exports in the year, according to the Ministry of Economy’s Tariff Information System.
Romero explained in a Deputies meeting, that PEMEX’s last report from August showed a negative balance of MX$96 million (US$4.5 million) due to MX$430 million (US$20.5 million) in tax payments causing a 51 percent loss. The company incurred in other expenses including debt payments of MX$101 million (US$5 million) and the MX$223 million (US$11 million) bill to acquire gasoline and diesel to meet national demand.
According to the government’s spending plan for 2021, PEMEX is expected to decrease its crude oil exports to 870Mb/d and will make-up for this decline with an increase in oil prices to US$42/b. Nevertheless, factors such as the pandemic crisis and an increase in Libyan production, among others, have affected international prices and have had repercussions for the Mexican oil price.
Despite PEMEX’s rescue plan and the government’s pouring of resources, the company registered losses of more than MX$954 billion (US$45 billion) due to plummeting demand.
Nevertheless, Romero stated that an increase in profits is expected and that plans to rehabilitate the existing refineries and to build the Dos Bocas refinery will continue. Romero expects major profits for November and December 2020 since production will increase from 693Mb/d to 1.1MMb/d representing a 58 percent increase in production. The company is also working with the government to fight huachicol, which in 2020 reached 4,300 stolen barrels.