Economics: Moody’s downgrades as Pemex 2023 results show further deterioration of its performance and balance sheet
Pemex’s 2023 results showed slight upticks in some operating numbers but nothing that could minimize the extent to which its financial indicators continued to fuel doubts as to the company's medium-term viability. This point was underscored by just the latest in a long stream of ratings and outlook downgrades: Moody’s on February 9 announced that it lowered its credit rating on the NOC’s debt and its creditworthiness.
The company achieved minor advances in production of liquid hydrocarbons with help from private partners and expanded crude oil exports. However, despite the major push of recent years to boost refinery capacity it processed less crude than in 2022 while producing low quality fuels. In short, Pemex continues to lose money and generate less and less in free cash flows even as its liabilities swell and downgrades make debt servicing increasingly onerous.
In this week’s Outlook section, we analyze Pemex’s operating and financial results for 2023 as well as related risks and prospects.
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