Fitch Raises Pemex to BB After $12 Billion Mexico Debt Backstop

Fitch Ratings upgraded Petróleos Mexicanos’ long-term foreign- and local-currency issuer default ratings to ‘BB’ from ‘B+’, a two-notch move that lifts the state oil company out of Rating Watch Positive and assigns it a stable outlook. The action reflects what the agency called “stronger government support” for the world’s most indebted energy producer. The upgrade follows Mexico’s successful placement of US$12 billion of pre-capitalised notes in global markets this week. Proceeds are earmarked to refinance about US$9.5 billion of Pemex debt maturing in 2025 and 2026 and to ease short-term liquidity pressure. President Claudia Sheinbaum’s administration has signalled it will continue backing Pemex while pursuing plans to lift oil production. Fitch cautioned that Pemex remains below investment grade and still faces structural challenges, including roughly US$98.8 billion in total debt, declining output and years of under-investment that have led to operational incidents. Additional upgrades would depend on further explicit government guarantees, stronger oversight or an improvement in Mexico’s sovereign rating, the agency said.