Pemex crude output extends decline in early 2015

OREANDA-NEWS. Mexico's state-run Pemex produced an average of 2.235mn b/d of crude on 1-25 January, reinforcing a declining trend that began a decade ago, according to preliminary data from the firm?s exploration and production division (PEP).

The production level in the partial January window fell below a 1981 level of 2.313mn b/d recorded by the US Energy Information Administration (EIA), but it could still rebound once the complete month?s data is published around the end of February.

Pemex averaged 2.353mn b/d in December 2014.

Natural gas production also shrank to 6.579bn ft3/d (184mn m3/d) in the partial January window, about 1.5pc less than in December.

Falling oil revenues and prices have triggered steep cuts of more than \$4bn in Pemex?s 2015 budget. PEP chief executive Gustavo Hernandez said last month the company is looking at ways to trim expenses without impacting the firm's objectives under a new energy reform.

Reducing its workforce of around 150,000 and scaling back generous benefits would free up cash, but politics could stand in the way. Officials at Pemex, one of the country's biggest employers, have repeatedly asserted over the past few weeks that all jobs will be saved. Pemex, which has gained budget autonomy from the finance ministry under the energy reform, will unveil its revised budget in the next few days.