Pemex adjusted its spending again. The exploration and production subsidiary received a 5.9% cut in its investment capital during the first quarter compared to what was scheduled.
The approved budget was 86.7 billion pesos, but the company reported to the US Securities and Exchange Commission that it invested 81.6 billion. The difference directly affects the production platform.
Currently, Pemex extracts 1.6 million barrels per day, far from the goal of 1.8 million. Gonzalo Monroy, director of GMEC, warned:
“We are flying directly and non-stop at 1.2 million barrels per day in 2027, which means that once the water is discounted, we would be at a million extraction levels during the next year.”
Drilling rigs also decreased: from 32 to 25 between January and May, according to data from the consulting firm. So far this six-year term, 10 mixed contracts have been awarded, seven in a first block (fields such as Macavil and Tamaulipas) and three recently (Rabasa, San Ramón and Cinco Presidentes). Pemex plans to produce up to 450 thousand barrels per day with these contracts, but the developments would take place beyond 2033.
Oil vocation in question
Miriam Grunstein, an academic at the Mexico Center at Rice University, said that the situation is alarming in the short term. Pemex loses income from lower exports and from privileging feeding the National Refining System, instead of extracting more crude oil.
“Sheinbaum’s government is betting on renewable electricity generation projects. Meanwhile, the budget cut in crude oil extraction indicates that the country no longer has a conviction or vocation for oil,” he said.
Grunstein added that the difference in investment between renewable energy and exploration is enormous: “At some point we are going to face a very harsh reality. The abandonment of extraction has been so much that it is alarming.”
Agreement with Petrobras, but without teeth
The Mexican government signed a collaboration agreement with the Brazilian Petrobras to acquire extraction techniques in deep waters, where Pemex has minimal activity. It includes exchange of knowledge and best practices, but the pact is non-binding, valid for two years and renewable.
Both Monroy and Grunstein agreed that the agreement was weak. Moody’s, when lowering Mexico’s rating on May 20, expressed greater concern about government debt and support for Pemex. The agency estimated that the government provided support for 35 billion dollars in 2025, equivalent to 1.9% of GDP, and budgeted another 14 billion for 2026. An improvement in the rating will depend on reducing the deficit and contingent risks of the oil company.
