In this Flash report, we take a closer look at Petróleos Mexicanos (Pemex). Pemex’s stand-alone operational and credit metrics remain unstable, with the company reliant on Mexican government support to stay afloat due to its financial distress. Therefore, government support will be crucial in determining Pemex’s future, especially as the company faces significant refinancing needs over the next few years. Fortunately, the new government under President-elect Claudia Sheinbaum seems willing to continue supporting the company at least in the short term. This should benefit Pemex bonds, but could negatively impact Mexican government bonds, whose fiscal deficit is already high and will only deteriorate with the support provided to Pemex.
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