Pemex’s net profit declined almost 70% annually in the second quarter of 2026, but the heavily indebted state oil company nevertheless asserted that it recorded “favorable results” in the period.
In a filing with the Mexican Stock Exchange on Friday, Pemex reported a net profit of 18.02 billion pesos (US $1.04 billion) between April and June, a decline of 69.7% compared to the second quarter of 2025.
📰 Comunicado Nacional | PEMEX registra resultados operativos y financieros favorables durante el segundo trimestre de 2026
🔗 https://t.co/aPIRDBLOM0 pic.twitter.com/pspHmI5YeQ— Petróleos Mexicanos (@Pemex) July 31, 2026
Pemex said that the lower profit was due to a 177% annual increase in its financial costs, higher tax obligations and an unfavorable exchange rate, with the peso strengthening around 2.5% against the US dollar in the second quarter of the year.
Despite the near 70% decline in its net profit, Pemex said in a statement on Friday that it recorded “favorable results in its main operational and financial indicators” in the second quarter.
“In an international environment of high volatility, the company maintained its production base, recorded higher levels of industrial transformation [i.e. refining] and guaranteed supply to the national market,” Pemex said.
The state oil company said that between April and June:
- Its “total production of hydrocarbons averaged 2.477 million barrels of crude oil equivalent per day,” an annual increase of 4.6%.
- Its production of liquid hydrocarbons averaged 1.658 million barrels per day (bpd), “supported by strategic fields such as Ixachi, Bakté, Itta, Koban and Maloob.” (This level of production is short of the government’s 1.8 million bpd goal and represents a decline compared to 2025.)
- Its processing of crude at refineries increased 2.9% annually to 1.008 million bpd.
- Its national sales of oil and oil products increased 9.8% annually to 1.471 million bpd.
- Its income from sales and services rose 30.3% annually to 510.4 billion pesos (US $29.45 billion).
- Its operating profit was 85.5 billion pesos (US $4.93 billion), a significant improvement from a 11 billion-peso loss in the second quarter of 2025.
Pemex also reported that its debt at June 30 was US $77.5 billion, a reduction of 9.1% compared to the end of 2025.
“In addition, short-term debt accounted for a smaller share of total debt, easing immediate financial pressures and strengthening the company’s financial flexibility. This is consistent with Pemex’s commitment to maintaining zero net debt,” the state oil company said.
Pemex is aiming to increase oil production, including via partnerships with private companies, as the federal government seeks to reach self-sufficiency for fuel. However, Reuters reported on Friday that “progress has been slower than hoped and uncertainty remains over how quickly new projects can contribute meaningful volumes.”
The news agency also said that Pemex “has increasingly directed production to domestic refineries as part of the government’s push for energy self-sufficiency, even as stronger oil prices could make exports more lucrative.”
In addition, Reuters reported that “Pemex is struggling to reverse years of declining output while it tries to reduce its financial obligations to bondholders, banks, suppliers and contractors.”
Citing the company’s Mexican Stock Exchange filing, Reuters said that as of June 30, Pemex ”had restructured 255.39 billion pesos [US $14.74 billion] of supplier debt incurred in 2025 under an eight-year payment scheme.”
The federal government has provided ample financial support for Pemex in recent years, and President Claudia Sheinbaum asserted in February that the company had “recovered” after former Mexican governments “dedicated 36 years to trying to disappear” it between 1982 and 2018.
Pemex debt hits lowest level in over a decade at $84.5 billion
When announcing a cut to Mexico’s sovereign credit rating in May, Moody’s warned that “continued support for Pemex will continue to limit fiscal consolidation.”
One new partnership that the federal government hopes will lead to a boost in oil production is that between Pemex and Brazil’s Petrobras, which are set to collaborate on deep-water exploration and extraction in the Gulf of Mexico.
With reports from AFP, El Economista and Reuters
Facts Only
Pemex reported a net profit of 18.02 billion pesos (US $1.04 billion) for the second quarter of 2026.
This net profit represents a 69.7% decrease compared to the second quarter of 2025.
Total hydrocarbon production averaged 2.477 million barrels of crude oil equivalent per day, an annual increase of 4.6%.
Liquid hydrocarbon production averaged 1.658 million barrels per day.
Crude processing at refineries increased 2.9% annually to 1.008 million barrels per day.
National sales of oil and oil products increased 9.8% annually to 1.471 million barrels per day.
Income from sales and services rose 30.3% annually to 510.4 billion pesos (US $29.45 billion).
Operating profit was 85.5 billion pesos (US $4.93 billion).
Total debt as of June 30 was US $77.5 billion, a 9.1% reduction from the end of 2025.
Pemex restructured 255.39 billion pesos (US $14.74 billion) of 2025 supplier debt into an eight-year payment scheme.
Pemex and Petrobras are collaborating on deep-water exploration in the Gulf of Mexico.
Executive Summary
Pemex is navigating a complex financial landscape characterized by a sharp 70% decline in net profits for the second quarter of 2026, despite reporting "favorable" operational results. This profit drop is attributed to a 177% surge in financial costs, increased tax obligations, and a strengthening peso. Conversely, the company shows strength in its operating profit, which swung from a loss in 2025 to a significant gain, alongside increased refining capacity and sales.
The company is attempting to balance debt reduction—lowering total debt to $77.5 billion—with a federal mandate for fuel self-sufficiency. While production of hydrocarbons has risen slightly, liquid hydrocarbon output remains below the government's 1.8 million bpd target. This tension is compounded by a strategic shift to prioritize domestic refining over potentially more lucrative exports. The long-term outlook remains uncertain, as the federal government provides substantial support while credit agencies like Moody's warn that such subsidies may hinder broader fiscal consolidation.
Full Take
The strongest version of this narrative is that Pemex is successfully pivoting from a profit-maximization model to a state-centric utility model, trading net bottom-line growth for operational stability and national energy security. By increasing refining and domestic sales while reducing total debt, the company is attempting to stabilize its foundation despite volatile financial costs.
The primary tension here is the "Performance Paradox": the company claims "favorable results" while its net profit collapses. This is a classic load-bearing framing device where operational metrics (production, refining) are used to overshadow financial deterioration (net profit). The narrative relies on the assumption that operating profit is a more honest indicator of health than net profit, effectively attempting to decouple the company's operational success from its massive debt burden.
Patterns detected: none
The root cause is a paradigm shift in governance—prioritizing "energy sovereignty" over market efficiency. This echoes historical state-led industrialization patterns where social and political goals (self-sufficiency) override fiduciary logic. The implication is that the cost of this transition is shifted from the company to the Mexican taxpayer and the national credit rating. The second-order consequence is a potential "fiscal trap," where the state cannot stop supporting the oil company without triggering a financial collapse, yet continuing the support degrades the nation's overall creditworthiness.
Bridge Questions: How does the eight-year supplier debt restructuring impact the actual liquidity of the company versus the reported debt figures? If oil prices spike, does the mandate for domestic refining become a net loss for the national treasury?
Counterstrike Scan: An influence campaign would likely omit the net profit decline and the Moody's warning entirely, focusing exclusively on the "recovery" rhetoric and the Petrobras partnership to create an illusion of inevitable growth. The current content does not match this pattern as it retains the critical financial contradictions.