PEMEX Posts 1Q26 Results

The Mexican Competitiveness Institute’s (IMCO) quarterly tracker finds that refining output has improved, with diesel production up 70%, but crude output remains near a 16-year low. Capital investment has hit an eight-year first-quarter floor, while gas venting surged 78.6% year-on-year. The federal government has now transferred MX$1.8 trillion to the company since 2019.

PEMEX recorded a net loss of MX$46 billion (US$2.646 billion) in 1Q26, a 6.1% deterioration compared to the MX$43.3 billion loss registered in the same period of 2025, according to the quarterly financial and operational tracker published by the Mexican Competitiveness Institute (IMCO) as part of its #EnLaMira project. The report, which analyzes more than 42 financial and operational indicators across a 16-year historical series from 2011 to 2026, draws on PEMEX's own unaudited 1Q26 results and identifies a pattern of persistent structural imbalances alongside selective operational improvements.

The net loss was driven primarily by a 25.3% decline in the value of oil exports, itself the result of a 38.8% contraction in the volume of crude exported during the quarter. Domestic sales partially offset that shortfall, growing 4.2% on higher volumes and prices of gasoline, diesel, and jet fuel, but were insufficient to compensate for the loss of external revenue.

Debt Reduction Continues But Remains Structurally Elevated

The headline debt figure shows continued progress on PEMEX's balance sheet repair. The company's gross financial debt stood at MX$1.43 trillion at the close of 1Q26, equivalent to 3.8% of Mexico's estimated 2026 GDP of MX$37.3 trillion, and 30.5% below the MX$2.05 trillion recorded in the same period of 2025. Both short-term debt, which fell 58.3%, from MX$561.8 billion to MX$234.5 billion, and long-term debt, which declined 20.0% from MX$1.49 trillion to MX$1.19 trillion, contributed to the reduction.

The financial cost of the debt also declined, falling 24.7% from MX$41.4 billion in 1Q25 to MX$31.2 billion in 1Q26, in line with the lower outstanding balance. The debt maturity profile shows that 14.4% of total financial debt, equivalent to MX$204.8 billion, will come due between April and December 2026, and 44.5% of the total (MX$634.9 billion) must be amortized before 2030.

Despite the improvement, IMCO notes that the debt load remains elevated and continues to represent a structural financial burden. PEMEX's net equity stood at negative MX$1.89 trillion as of March 31, a 7.4% improvement compared to year-end 2025, but reflecting a company whose total liabilities of MX$4.1 trillion are 86.4% larger than its total assets of MX$2.2 trillion. Net equity has been negative continuously since 2013.

Debt owed to suppliers and contractors stood at MX$375.1 billion, down 7.2% from MX$404.4 billion in 1Q25, but still the second-highest level recorded for a first quarter in the 16-year series.

Operational Picture: Refining Up, Production Near Historic Low

On the upstream side, crude oil production (excluding condensates) reached 1.368MMb/d in 1Q26 — a marginal 0.4% increase over the 1.362MMb/d recorded in 1Q25, but still the second-lowest first-quarter production level in the 16-year study period. Gas production, including that of PEMEX's partners, reached 4.851Bcf/d, a 10% increase year-on-year, though still 28.9% below 2011 levels.

The refining segment showed the quarter's most notable improvement. Total refined product output reached 1.110MMb/d, a 21.9% increase over the 0.910MMb/d of 1Q25. Gasoline production rose 27.7%, from 305.0Mb/d to 389.6Mb/d, while diesel production grew 69.9%, from 168.2Mb/d to 285.7Mb/d. Together, gasoline and diesel accounted for 61% of total product output. The Mexican Mix export price averaged US$68.0/b in 1Q26, 5.2% above 1Q25 and above the MX$62/b assumption in the government's 2026 economic criteria.

Capital investment, however, deteriorated sharply. PEMEX's budgetary investment totaled MX$54.2 billion in 1Q26, a 47.5% decline from MX$103.3 billion in the same period of 2025 and the lowest first-quarter investment level in eight years. The amount represents just 21.9% of the MX$247.2 billion approved for the full year.

Government Support: MX$1.8 Trillion Since 2019

IMCO notes that despite a strengthening program launched in 2019, PEMEX continues to receive annual federal budget transfers to meet its financial obligations. In 1Q26, the federal government provided MX$58.3 billion in capital contributions, a figure below the MX$80.0 billion transferred in 1Q25. Between January 2019 and March 2026, total government support to PEMEX has reached MX$1.8 trillion, of which 78.9% consists of capital contributions, 17.7% of fiscal incentives, and 3.4% of other instruments. These figures do not include additional support from the progressive reduction of the DUC rate between 2020 and 2024, the fiscal benefits associated with the new Oil Tax for Well-Being, or the liquidity operations promoted by the SHCP in 2025.

Environmental and Safety Indicators Worsen

Gas venting and flaring rose sharply in the quarter. PEMEX sent 618MMcf/d of natural gas into the atmosphere in 1Q26, a 78.6% increase over the 346MMcf/d recorded in 1Q25, and equivalent to 12.7% of total gas production. Sulfur oxide (SOx) emissions reached 385,000t, up 14.4% from 337,000t in 1Q25 and the highest first-quarter level since 2012. The accident frequency index rose 41.3%, from 0.28 to 0.39 incidents per million man-hours, while the severity index, measuring lost days per million man-hours, increased 128.7%, from 7 to 17 days.

On credit ratings, Fitch Ratings maintained PEMEX at BB+ with stable outlook; HR Ratings at BBB+ (G) with stable outlook; Moody's at B1 with stable outlook; and Standard & Poor's at BBB with stable outlook. Fitch and Moody's both carry speculative-grade designations on the international scale.