Pemex’s dollar bonds were higher by ~1 point with sources noting that the company is planning to issue at least $2bn in bonds before a blackout period starts on February 12. Earlier this month, sources said that the Mexican Finance Ministry wanted Pemex to be able to meet its Q1 dues by itself unless it did not have sufficient cash. The Mexican state-owned energy major which reported a net loss of MXN 52bn ($2.7bn) in Q3 last year, has MXN 188bn ($9.7bn) in amortizations due in 2023. Of the $9.7bn in amortizations, $5.5-6bn are due in Q1 alone. During its Q3 earnings call, it said that it wanted to maintain a zero net debt level in real terms. Luis Maizel, co-founder of LM Capital Management said, We are getting to the point where the indebtedness of the company is getting outrageous… They said there would be no new issuance. But when you have no option, you have to get the money somewhere”. The Mexican government stopped covering Pemex’s amortizations in 2H 2022 due to the surge in oil prices. However, the fall in Brent crude prices since H2 by over 25% has offset some of the benefits of the earlier price surge.
Pemex’s 5.35% 2028s were up 0.9 points to trade at 88.15, yielding 8.27%.
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