Mexican oil company Pemex reports the second quarter loss of $5.2bn

GMT 18:07 2015 Tuesday ,28 July

Arab Today, arab today Mexican oil company Pemex reports the second quarter loss of $5.2bn

Mexican oil company Pemex
Mexico City - AFP

State-owned Mexican oil company Pemex reported Tuesday losses of $5.2 billion in the second quarter, due mainly to lower petroleum prices.

It said prices of Mexican crude were 44 percent lower than in the same period a year ago.

In the first quarter of 2015, Pemex lost $6.5 billion.

The new losses -- 84.6 billion pesos in local currency -- far surpass those of the second quarter of 2014, which came in at 52.3 billion pesos.

Pemex is Mexico's largest company and its performance is critical to the health of state finances.

The company has been reporting heavy losses since 2013 mainly as a result of slumping oil prices.

In an earnings report released Tuesday, the company said the price of a basket of Mexican oil types used for export fell from $97.09 a barrel in the second quarter of 2014 to $53.95 a barrel in the same period of this year.

Last year Pemex cut spending by 11.5 percent, suspending such projects as one for deep-water exploration.

In 2014, President Enrique Pena Nieto ushered in a historic constitutional reform that opened up the Mexican oil sector to foreign money.

The goal was to lure capital that would reinvigorate the sector and stimulate Mexican economic growth.

The project got off to a disappointing start, however.

On July 15, Mexico held an auction of deepwater offshore oil blocks in the Gulf of Mexico. But with oil prices still low and Iran about to return to the oil market, demand was slack and only two of 14 blocks that were up for auction attracted bids large enough for deals to be sealed.

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