Moody’s lowered the credit rating of Petróleos Mexicanos (Pemex) from Ba2 to Ba3 with a negative outlook, the decision is based on the risks of high levels of debt maturities and lower operating cash flow derived from the expansion of its refining business , which has generated losses in recent years.
The rating agency indicated that these losses are around 17,000 million dollars only between 2018 and 2020, a trend that is expected to continue in the short and medium term.
On the other hand, he stressed that although the growth of oil and gas production has been below the objectives, he acknowledged that the oil company headed by Octavio Romero, has managed to reverse the fall in production and reserves in the last two years.
Also read: Pemex, among the 10 most indebted companies on the planet
“However, Moody’s expects Pemex’s cash flow generation and credit metrics to deteriorate even further in the next three years as the company ramps up fuel production, while facing limited investment capacity of capital, high debt maturities and volatility in oil and fuel prices, ”he reported.
He also referred to the heavy dependence on the federal government, which will continue to finance Pemex’s cash needs.
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Moody’s expects Mexico’s GDP to increase 5.6% in 2021
The credit rating agency also reported that it expects Mexico’s GDP to increase 5.6% in 2021 and 2.9% in 2022, driven in part by faster growth in its main trading partner, the United States.
Despite a broad economic recovery, he said that inflation-adjusted real wages in Mexico are contracting and that if this decline continues the outlook for consumption will darken.