Mexico’s state oil giant, Pemex, has reported a staggering 190.5 billion-peso ($9.1 billion) loss for Q4 2024, marking a sharp reversal from its profit a year ago. The company attributes this financial bloodbath to soaring operational costs, asset devaluations, and currency exchange losses—painting an increasingly grim picture for the world’s most indebted oil company.

Crude (and condensate) production continues its downward spiral, slipping to 1.65 million bpd—down nearly 10% from the same period last year—further tightening the financial chokehold. Aging offshore fields like Maloob and Zaap, along with onshore Quesqui, are losing steam, and without outside investment, Pemex remains stuck in a cycle of decline.

Even Pemex executives are now openly acknowledging the crisis. “Pemex is going through a challenging situation, and one that’s different from past circumstances,” said corporate planning chief Jorge Alberto Aguilar. That’s a rare admission from a company that has long painted over its cracks with government backing.

Despite a modest 3% revenue bump to 436.6 billion pesos, Pemex’s financials remain bleak. Working capital is deep in the red at negative 750.6 billion pesos, and financial debt remains suffocating at $97.6 billion, despite significant federal support. In 2024 alone, the government funneled 156.5 billion pesos into Pemex, with nearly all of it going toward debt repayment.

Meanwhile, Pemex’s refining output hit 786,000 bpd, aligning with the government’s push for fuel self-sufficiency. But with supplier debts now at a staggering 506.2 billion pesos ($24.2 billion), the company’s ability to fund operations—let alone growth—remains in question.

Bottom line: Pemex’s downward trajectory isn’t slowing, and unless the government rethinks its strategy, the oil giant’s financial woes will only deepen.

The trend has spilled over into the new year, with Pemex booking a 44% decline in crude oil exports in January to 530,000 bpd—the lowest export rate in decades.

By Julianne Geiger for Oilprice.com

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