Pemex Struggles: State Oil Giant Drags Down Mexican Production

Mexico’s oil industry faces a sobering reality. The country’s crude oil production has fallen for ten straight months. This trend highlights the ongoing struggles in Mexico’s energy sector.

In October, Mexico produced 1.527 million barrels of oil per day. This marks a 6.8% drop from the same month last year. The National Hydrocarbons Commission (CNH) reported these figures in their latest update.

The decline isn’t new. Since January, Mexico’s oil output has decreased each month compared to 2023. The drops range from 2.8% to 6.8%. This contrasts with the slight growth seen in 2023.

Pemex, the state-owned oil company, plays a major role in this trend. It accounts for 93.2% of national oil production. Pemex has seen its own output fall throughout the year.

The decreases range from 2.2% to 7.6% compared to 2023. Other oil companies operate in Mexico too. There are 28 active operators besides Pemex.

These firms won contracts in bidding rounds from 2015 to 2018. In October, they produced 103,345 barrels per day. This was a 6.1% increase from last year.

Mexico’s Declining Oil Production and Challenges Ahead

The overall picture remains gloomy. From January to October, Mexico’s average daily oil production was 1.571 million barrels. This represents a 5.2% drop from the same period in 2023.

Total liquid production, including gas and condensates, also fell. It averaged 1.840 million barrels per day in the first ten months of 2024. This is another 5.2% decrease from last year.

Condensate production suffered too. These valuable liquids, like naphtha, saw a 5% decline. Output averaged 269,180 barrels per day from January to October.

These numbers come as Mexico considers changes to its energy regulation. The CNH may soon lose its budget autonomy. It could become part of the Energy Ministry, reducing its independence.

The oil industry’s struggles have wider implications. They affect Mexico’s economy and energy independence. The country faces tough choices ahead in managing its natural resources.

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