Fitch gives Pemex debt BBB+

Fitch Ratings said it assigned a long-term rating of BBB+ to Pemex (Petroleos Mexicanos)' senior unsecured debt four tranches issuance of €3.15 billion due between 2022 and 2029.

The company expects to use the proceeds to refinance upcoming maturities and to fund capital investments.

Fitch said the ratings reflect the government of Mexico's high incentives to support the company as a result of the very strong socio-political and financial consequences a financial distress would have for the country.

“A financial distress situation at Pemex holds the potential to disrupt the supply of liquid fuels in the entire country, which could have material social and economic consequences for Mexico,” the agency said in a news release.

“Mexico is a net importer of hydrocarbons, and Pemex relies on the import of basic oil products, including dry gas, petroleum products and petrochemicals to supply local demand.

“Furthermore, a financial distress situation at Pemex may have implications for the ability of either the government or other Government Related Entities (GREs) within the country to raise financing in the future.”

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