Mexico City – State oil company Pemex has reduced its debt to suppliers by half under the current management of President andrés Manuel López Obrador, the company announced today. As of November 29, 2023, Pemex reported outstanding supplier debt of 83.9 billion pesos (approximately $4.6 billion USD), a significant decrease from the 168.9 billion pesos ($9.3 billion USD) owed when López Obrador took office in December 2018.
The debt reduction signals a potential turning point for Pemex, which has struggled for years under the weight of massive debt and operational inefficiencies. Lowering obligations to suppliers aims to improve relationships with key vendors, ensuring a more stable supply chain for the heavily indebted company and bolstering its ability to maintain production levels. The move comes as Pemex faces increasing scrutiny over its financial health and its central role in MexicoS energy policy.
Pemex attributed the reduction to a strategy of prioritizing timely payments and renegotiating contracts. “We have made a commitment to pay our suppliers on time, and we have been fulfilling that commitment,” said Pemex Director Octavio Romero Oropeza in a press conference. “This has allowed us to rebuild trust with our suppliers and reduce our debt.”
The company reported paying off 85.1 billion pesos in supplier debt during the current administration. Pemex also highlighted efforts to streamline procurement processes and increase transparency in its dealings with suppliers.
Despite the progress, challenges remain. Pemex still carries a substantial overall debt load of approximately $38.8 billion USD, and its financial performance continues to be a concern for investors and credit rating agencies. The company’s ability to sustain the reduction in supplier debt will depend on its future financial performance and its continued commitment to responsible financial management.
