Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Moody's cuts indebted oil firm Pemex's rating by two notches to B3

Published 02/09/2024, 10:31 PM
Updated 02/09/2024, 10:35 PM
© Reuters. FILE PHOTO: Signage of Petroleos Mexicanos (Pemex) is pictured at the company's headquarters in Mexico City, Mexico July 26, 2023. REUTERS/Raquel Cunha

MEXICO CITY (Reuters) - Ratings agency Moody's (NYSE:MCO) on Friday downgraded its rating for Mexico's state-owned oil firm Pemex by two notches to B3 from B1 previously, citing poorer credit quality.

Moody's, which has a negative outlook for the firm, said it assumed the company was receiving high government support, and that this support could be jeopardized by a 2024 deterioration of Mexico's fiscal conditions.

Pemex is among the world's most indebted oil companies, with financial liabilities exceeding $100 billion.

The agency said it expected a considerably higher fiscal deficit in Mexico on the back of high borrowing costs, social spending and emblematic government projects.

© Reuters. FILE PHOTO: Signage of Petroleos Mexicanos (Pemex) is pictured at the company's headquarters in Mexico City, Mexico July 26, 2023. REUTERS/Raquel Cunha

Moody's said it expects costs for further supporting Pemex to have increased by the time Mexico's next administration comes into power in October.

The downgrade comes the same day Mexico's government ordered the expropriation of a hydrogen plant at a Pemex refinery that had been sold to France's Air Liquide (OTC:AIQUY) under the previous administration.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.