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LatinNews Daily - 08 April 2020

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In brief: Mexico’s measures for Pemex insufficient, warns Moody’s

* Credit ratings agency Moody’s Investors Service has estimated that Mexico’s state-owned oil company Petróleos Mexicanos (Pemex) continues to face a high liquidity risk, despite President Andrés Manuel López Obrador’s announcement that the company will receive a tax break of M$65bn (US$2.7bn) for the rest of 2020. López Obrador also said that Pemex will produce an extra 400,000 barrels per day (bpd) to reduce fuel imports. However, Moody’s estimates that sustaining production while global oil prices are low will mean that “Pemex will tap the totality of its existing US$8.9bn in committed credit facilities during 2020, which would no longer be available to support cash needs in 2021.” Moody’s predicts that Pemex’s high liquidity risk is set to increase in light of the economic crisis driving down oil demand and prices, and with about US$6.2bn of the company’s debt due to mature.