Sheinbaum assigns rescue mission to new Pemex CEO

Mexican President Claudia Sheinbaum has tasked Juan Carlos Carpio, the new CEO of struggling state oil company Pemex, with increasing oil and gas production, transforming downstream operations and forming a wide-ranging partnership with Brazilian peer Petrobras.

“The challenges are to consolidate production,” Sheinbaum told a press conference in Mexico City on Friday. “Pemex has to invest a very significant amount in exploration, in new fields ... to achieve its target of 1.8 million barrels per day.”

On Thursday, Sheinbaum accepted the resignation of Víctor Rodríguez Padilla, a former academic colleague whom she appointed to run the company in October 2024.

Rodríguez failed to meet Sheinbaum’s goal of stabilizing oil production at 1.8Mb/d, with output dropping to around 1.6Mb/d during his tenure. During his time at the company, Pemex was beset by spills, fires and other industrial accidents.

Carpio was chief financial officer at Pemex before taking on the top job.

“He is the person who knows the most about all areas, not only from a financial perspective,” Sheinbaum said on Friday. “He has a comprehensive vision of the company.”

Pemex has begun talks with Brazilian state oil company Petrobras about a partnership that could extend well beyond deepwater and ultra-deepwater exploration.

This week Petrobras CEO Magda Chambriard said the agreement could include partnerships in mature fields, refining, gas processing and petrochemicals.

Energy sovereignty

Sheinbaum has persisted with the energy sovereignty policy of her predecessor Andrés Manuel López Obrador and wants to reduce Mexican imports of gasoline, diesel and jet fuel from the US.

On Friday, Sheinbaum said she wants Carpio to modernize Pemex’s aging refineries, including by completing the construction of two coking plants at the Tula and Salina Cruz refineries. That will increase Mexico’s fuel production.

In a break with López Obrador, Sheinbaum has signaled that she is ready to lift Mexico’s unofficial ban on fracking for unconventional gas to reduce the country’s dependence on imports from the US.

Increased domestic natural gas output will support Pemex’s goal of boosting petrochemicals and fertilizer production, another of the key priorities for Carpio that Sheinbaum listed on Friday.

Rescue

In 2025, Sheinbaum orchestrated a government bailout that helped reduce the company’s debt to US$79 billion (bn), the lowest level since 2014. Pemex owes suppliers US$21bn.

This week ratings agency S&P revised its outlooks on Mexico and the oil company from stable to negative. Pemex will need government support to meet debt maturities in 2026.

“Pemex's stand-alone credit profile remains 'ccc+', reflecting our belief that its capital structure is unsustainable, given its weak liquidity and high leverage. Pemex had a debt-to-EBITDA ratio of 5.8x and posted negative free operating cash flow in the first quarter of 2026,” the agency said.

“Poor operational results at Pemex could prompt the government to provide more funds to cover future financial losses, widening the fiscal deficit.”

Pemex reported a loss of 46 billion (bn) pesos (US$2.6bn) in the first quarter, as it cut crude exports and sent more oil output for processing at domestic refineries.

(The original version of this content was written in English)