Mexico to Cut $5b From Pemex Budget

Mexico to Cut $5b From Pemex BudgetMexico to Cut $5b From Pemex Budget

Mexican Finance Minister Jose Antonio Meade said last week that approximately $5.4 billion in funds for state-run oil firm Pemex will be eliminated from the proposed federal budget in 2017. "Pemex is making the biggest contribution to the cuts," Meade said about the company that will see an 18% reduction in funds and will make up some 41% of the $12.83 billion slashed from the budget, Oil Price reported. The budget was created with an outlook of $42 per barrel oil and an expected output of 1.93 million barrels per day in 2017. Mexican oil production has steadily decreased over the past eleven years as output is anticipated to drop from 2.16 million bpd to below the 2.0 million bpd mark for the first time since 1980. Since the government signed off on a major energy reform in 2013 to break up the Pemex monopoly in Mexico, the company has seen increased competition from private sector producers.