Pemex Turning the tanker

4/23/2016 The Economist 

Oil barrelsTHE radio in the office of José Antonio González is tuned to one of the American classical-music stations that he loves. The sounds may be relaxing, but the firm Mr González has led since February—Pemex, Mexico’s state-owned oil company—is in crisis. On April 13th the Mexican government was forced to respond to the firm’s troubled finances with a 73.5 billion peso ($4.2 billion) aid package and a 50 billion peso tax cut. This week Mr González headed to New York to soothe the fears of banks and rating agencies.

They will take some persuading. Pemex’s crude production fell last year to 2.3m barrels a day, down from a peak of 3.4m in 2004. Next year, says the finance ministry, that will probably fall to 2m—“a disaster”, says Adrián Lajous, a former Pemex chief. After taxes and royalties the company made a loss of 522 billion pesos last year. In March Moody’s cut Pemex’s credit rating by two notches to its lowest investment grade. More bad news followed on April 20th when several workers died in a blast at a Pemex facility.

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