PEMEX Production Declines, Fuel Sufficiency Challenges

PEMEX production experienced its largest annual decline in over five years, marking 24 consecutive months of year-on-year decreases. In addition, Mexico's ambitious goal of achieving fuel sufficiency by 2024 remained unfulfilled despite significant investments in refining infrastructure.

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PEMEX Production Declines; Energy Partnerships Loom

In November, PEMEX's crude oil production experienced its largest annual decline in over five years, marking 24 consecutive months of year-on-year decreases, as reported by El Economista. The company's crude extraction dropped by 10.2% to 1.407MMb/d, the steepest decline since April 2019. This volume is the lowest since May 1979, which recorded 1.401MMb/d.

Fuel Self-Sufficiency Still a Goal for 2025

Mexico's ambitious goal of achieving fuel self-sufficiency by 2024 remained unfulfilled despite significant investments in refining infrastructure, including the high-profile Dos Bocas refinery project. The Olmeca refinery, which experienced several delays and cost overruns, was processing only 6.5% of the crude oil entering PEMEX’s refineries by August 2024, near the end of López Obrador’s term. Operating at 19% of its capacity, the refinery processed 65.406Mb/d of crude oil in July, marking its first full month of operations. This addition brought the total crude oil processed across the National Refining System (SNR) to 1.013MMb/d, with an overall utilization rate of 51% of the installed capacity, now at 1.98MMb/d including Olmeca's 340Mb/d capacity.

Mexico Increases Oil Exports to Cuba by 25% in 2024

Between January and September 2024, Mexico exported oil and petroleum products to Cuba valued at $500 million, marking a 25% rise compared to the previous year, according to a report from PEMEX submitted to the US Securities and Exchange Commission. This accounts for 2.9% of Mexico’s overall crude oil exports.

Carlos Slim Bets on Fossil Fuels

Carlos Slim is strategically positioning himself to capitalize on the continued demand for fossil fuels, a trend he anticipates will persist in the foreseeable future. Through his family investment firm, Control Empresarial de Capitales, Slim invested US$602 million to increase his stake in PBF Energy, a prominent US refining company, to 25%. In addition, he acquired US$326 million in shares of Talos Energy, a Houston-based oil producer.