PEMEX's Debt Crisis Threatens Oil Production in Mexico

PEMEX’s production stability is untenable without restoring liquidity flows across its  service supply chain. Today, short-term financial strain is both quantifiable in  corporate reports and visible in the field: short-term liabilities account for 29% of the  company’s total debt, and working capital remains deeply negative. Suppliers  represent approximately 35% of these liabilities, further tightening operational cash  flow. 

According to PEMEX’s latest quarterly report, by the second quarter of 2025 the company’s  working capital stood at –MX$756 billion (US$41 billion). Quarterly revenues reached MX$392 billion, with an operating loss of MX$12 billion and a net profit of MX$60 billion, driven exclusively by a foreign exchange gain of MX$135 billion. 

On the suppliers’ side, stress is systemic. During the public forum held in Campeche  on Sept. 1, industry associations estimated total outstanding payments at MX$431 billion (1.2% of GDP), with a 2024 carryover that current mechanisms for 2025 fail to address. 

In a sample of 49 AMESPAC member companies, as of 1H25, the debt amounted to MX$86.7 billion — MX$58.2 billion from 2024 and MX$28.5 billion from 2025.  This includes executed estimates not yet registered in the COPADE system, which  are not recognized for payment or financing purposes. 

Timely payment is the fastest, most cost-effective way to safeguard production  volumes and skilled labor. It prevents deferrals, avoids remobilization costs, and  ensures timely well delivery. AMESPAC has proposed a minimum certainty agenda  to the Executive Branch, Finance Ministry (SHCP), and PEMEX, which includes releasing certified invoices, enabling invoice registration in COPADE, establishing a  decision-making task force, and publishing a verifiable payment schedule.

Why Payment Is a Technical Variable 

In upstream operations, cash flow to the service chain is not an accounting detail, it  is a technical requirement that determines whether crews, rigs, chemicals, piping,  cementing services, logistics, and intervention windows are available on time. When  payments are interrupted, the operational affects rig counts drop, well completions  decline, major maintenance is deferred, and both current and future barrels are lost. 

Recent reports confirm the financial strain and its operational echo: higher short term liabilities, negative working capital, fewer rigs, and fewer completed wells as of the second quarter of 2025, none of which can be explained without considering restricted  cash flow to service contracting. 

Between the second quarter of 2024 and the second quarter of 2025, active rigs fell from 59 to  27 (–54%). Wells drilled dropped from 39 to 10, and completions declined from 37  to 13 over the same period. 

The mechanics are simple: verified payment, certified invoices and timely  registration-enables procurement of critical inputs, deployment of drilling and  workover crews, integrity testing, and the logistics necessary for continuous  operations. 

With reliable cash flow, crews complete work on time, major maintenance is  executed without delay, wells are connected, and facilities operate, preserving  liquids production and slowing natural decline. 

The reverse is also true. When executed work is not entered into COPADE, it  effectively “does not exist” in financial or operational planning. Contractors shut down  operations, remove equipment, miss connection windows, and decline rates  accelerate. 

Recent empirical data confirms this transmission chain. PEMEX’s operational traction has weakened in the second quarter of 2025. Short-term debt weighs more heavily on the  balance sheet, working capital remains in the red, and equipment deployment and  well activity have contracted.

At the same time, liquids production continues to decline relative to 2018 and rising  condensate volumes fail to offset falling crude output. Under these conditions, any recent “plateau” in production relies on isolated interventions in mature fields, by  definition, highly vulnerable to service disruptions. 

Between the second quarter of 2018 and the second quarter of 2025, crude output dropped by  26%, while condensates surged twelvefold. Meanwhile, the National Refining System  now consumes 61% of crude production (up from 38%), reducing exports from 64%  to 36%. 

Stabilizing the production platform requires operational and financial discipline.  Timely payments, complete invoice registration, and transparent traceability  connecting cash flow to rigs, wells, and production are the fastest way to turn  administrative decisions into measurable technical outcomes. 

Debt Breakdown 

As of the second quarter of 2025, public accounting data clearly shows that PEMEX’s  liquidity stress is no longer cyclical. Operational traction is visibly impaired. PEMEX  posted an operating loss for the quarter, and the net profit stemmed solely from FX  gains. This underscores that the company’s core business lines are not generating  sufficient cash to sustain payments to suppliers without targeted action. 

In other words, liquidity issues are not just perceived by industry, they are reflected  in PEMEX’s consolidated financials. Short-term liabilities now represent 29% of total  debt (up from 10% in 2018 and 14% in 2020), and supplier-related liabilities alone total MX$431 billion as of the second quarter of 2025. 

AMESPAC has confirmed that while COPADE registration partially reopened for 2025 services, no payments have followed. The backlog from 2024 remains  unresolved, despite accounting for two-thirds of the total debt in the sample. 

For this reason, AMESPAC’s June 11 letter and press release called for three  actions: 1) a decision-making task force, 2) full regularization of 2025 invoices, and  3) a formal program to clear 2024 debt, including reactivation of COPADE  registration. As of July 7, PEMEX’s executive-level response acknowledged internal procedures but failed to establish the task force, release certified invoices, or present  a payment schedule. 

Without COPADE reactivation for 2024, two-thirds of the sample’s debt, amounting to MX$58.2 billion, remains without a pathway to recognition or payment. 

At a broader level, creditor associations publicly reiterated on Sept. 1 that total  supplier debt stands at MX$431 billion (1.2% of GDP) and that 2024 arrears are not addressed by current mechanisms for 2025. 

Field-Level Impact: Drilling, Maintenance, and Decline 

As of the second quarter of 2025, PEMEX’s operational data points to a clear contraction  that goes beyond temporary fluctuations. The execution cycle has been disrupted:  fewer rigs in operation, fewer completed wells, and growing delays in major  maintenance. Investment fell from MX$371 billion in 2024 to MX$126 billion in  2025 (–66%), with E&P down from MX$75 billion to MX$18 billion (–76%). 

This financial backdrop, persistent negative working capital and growing short-term liabilities, explains the transmission into field operations: tighter cash leads to  delayed work orders, crew removals, and lost technical windows. The result: a  smaller, more fragile production base. 

Compared to the second quarter of 2018, field activity in the second quarter of 2025 shows a marked drop in active rigs and wells drilled or completed, directly impacting new  barrel incorporation. 

The company’s operating loss and FX-driven net profit confirm that E&P is  underperforming. Operational momentum has weakened, largely due to unpaid  invoices and unregistered services. 

This decline is compounded by the increasing concentration of production in a  handful of assets, meaning that any disruption in logistics or maintenance has an  outsized impact.  

Between the second quarter of 2018 and the second quarter of 2025, KU-Maloob-Zaap declined  from 884 to 540 Mb/d (–39%), Abkatún-Pol-Chuc from 179 to 117 Mb/d (–35%), and Cantarell from 160 to 114 Mb/d (–29%). The platform’s resilience depends on uninterrupted interventions and workovers. 

In other words, the apparent "plateau" in recent production is largely the result of  temporary mature field interventions and increased condensate output. But this  cushion neither offsets the crude decline nor replaces the need for sustained drilling  and workover campaigns. Without stable cash flow to keep rigs and crews  operational, this plateau will erode quickly, and natural decline will accelerate. 

The operational cost of this dynamic is not limited to today’s lost barrels. It includes  remobilization expenses, the erosion of technical capabilities due to workforce  attrition, and asset deterioration from extended shutdowns. 

From a management standpoint, the only way to restore drilling momentum, reduce  the maintenance backlog, and sustain recovery factors is to normalize payments  with complete, verifiable records, allowing technical planning, not cash constraints,  to set the pace for rigs, wells, and connections. 

The Importance of Predictability 

Normalizing payments is not a union demand, it is the technical decision that  restores drilling traction, ensures maintenance continuity, and secures barrels at a  lower cost than any delayed remedy. 

The path forward is both feasible and measurable: immediately release certified  invoices, fully enable COPADE registration for executed services, and publish a  binding payment schedule. With this framework in place, engagement between  PEMEX, SHCP, and the service chain will cease to be rhetorical and become a  discipline of measured execution. 

AMESPAC will continue to press for evidence-based accountability and shared  responsibility. Mexico does not lack talent or technology, it lacks predictability. When  predictability exists, barrels are preserved, specialized jobs are retained, and energy  sovereignty stops being a slogan and becomes an operational reality.