Pemex's 2008 Net Loss 'Significantly Greater' Than 2007 Loss

MEXICO CITY (Dow Jones Newswires), Jan. 27, 2009

Mexican state oil company Petroleos Mexicanos said Tuesday its 2008 net loss will be "significantly greater than" year-ago losses due to a weaker local currency and the sharp oil price drop in the second half.

In a filing, Pemex said although it reported net income of 5.6 billion pesos for the first nine months of 2008, it expects 2008 losses to grow on year.

"This increase in loss is mainly due to the decline in international oil prices ... and to the depreciation of the peso against the U.S. dollar," said Pemex.

Concerning the foreign exchange losses, Pemex attributed them to "the recognition in Mexican pesos of the outstanding debt stated in foreign currencies that are recognized in the comprehensive financial result."

Over the past six months the peso has weakened nearly 30% against the U.S. dollar, while oil prices have fallen by more than 70% from record highs of more than $145 a barrel in July 2008.

Pemex reported a net loss of MXN16.13 billion in 2007 despite record oil prices due to the heavy tax rates and expensive subsidies for imported fuel.  

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