S&P upgrades Pemex, subsidiaries

Standard & Poor's said it raised Petroleos Mexicanos' (Pemex) foreign currency ratings to BBB+ from BBB and local currency ratings to A from A-.

The agency also raised the ratings on Pemex's subsidiaries, PMI Trading Ltd., PMI Norteamerica SA de CV and MGI Supply Ltd., mirroring the ratings on Pemex.

At the same time, S&P affirmed its mxAAA/mxA-1+ national scale ratings on Pemex and raised the counterparty and financial strength ratings on Kot Insurance Co. AG to A from A-.

The outlook is stable.

"The rating actions follow the recent one notch upgrade on Mexico to foreign currency BBB+ and local currency A. In accordance with our criteria for government-related entities, we still believe that there is an almost certain likelihood that the government of Mexico would provide timely and extraordinary support to Pemex in case of financial distress, and therefore we equalize the ratings on Pemex with those on the sovereign," S&P credit analyst Fabiola Ortiz said in a news release.

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