Petroleos Mexicanos, commonly known as Pemex, has announced its first quarterly profit in more than a year, reporting a net profit of $3.16 billion (59.52 billion Mexican pesos) for the second quarter of 2025. This turnaround is largely attributed to the appreciation of the Mexican peso against the U.S. dollar, providing a rare positive outcome amid ongoing financial challenges.
The company, which is the world’s most indebted energy firm, faced substantial losses in the previous year, totaling around $30 billion. In the fourth quarter of 2024, Pemex recorded a loss exceeding $9 billion. Compounding these financial difficulties, crude and condensate production continued to decline, dropping to 1.65 million barrels per day—a nearly 10% decrease compared to the same period in 2023.
Despite the profit reported for Q2, Pemex’s revenues fell due to decreased sales and lower commodity prices. The favorable currency exchange played a significant role in the profit, offering the company a temporary respite from its financial struggles. The Mexican government is once again stepping in to support Pemex. Last week, the Finance Ministry announced a new financial initiative that includes issuing “Pre-Capitalized Notes,” a financing method designed to reinforce Pemex’s balance sheet without a direct government guarantee.
This new plan is part of a larger strategy to stabilize a company grappling with high debt levels, declining production, and operational inefficiencies. Following the announcement, Fitch Ratings placed Pemex on a positive rating watch, indicating that the transaction is credit positive and reflects the federal government’s commitment to providing substantial support to the company.
However, despite this temporary relief, Pemex’s financial profile remains precarious. Fitch highlighted concerns regarding negative operational cash flow, diminishing profit margins due to lower production and oil prices, and persistent losses in its downstream business. The overall outlook for Pemex is characterized by ongoing challenges that continue to threaten its long-term viability.
As Pemex navigates these turbulent waters, the government’s financial interventions may offer a stopgap solution, yet the fundamental issues plaguing the company remain unresolved. The coming months will be crucial for Pemex as it attempts to stabilize its operations and regain a foothold in the competitive energy market.
