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By KELIN DILLON

In the recently released 2022 edition of Brand Finance’s Oil & Gas 50, Mexico’s state-owned oil company Petróleos Mexicanos (Pemex) fell from 16th to 20th place in the rankings of the world’s 50 largest oil companies.

The drop stems from Pemex’s 6 percent reduction in valuation from 2021 to 2022; while the Pemex brand was valued at $5.59 billion in 2021, the company was brought down to $5.21 billion in 2022. Under the administration of Mexican President Andrés Manuel López Obrador (AMLO), however, Pemex’s overall valuation has declined by 42 percent since AMLO took office three years ago, when the Pemex brand was evaluated at $9.1 billion. 

According to energy sector expert Gonzalo Monroy, Pemex’s drop over recent years has come from its reluctance to embrace green energies – an issue well-documented across López Obrador’s quest to reform Mexico’s energy policy in favor of Pemex’s dirty energy.

“We are seeing Shell getting into the wind energy business, Equinor getting out of the oil business, ExxonMobil into carbon capture,” revealed Monroy about Pemex’s major competitors’ efforts toward clean energy, while Pemex has doubled down on its polluting practices in the meantime.

While the covid-19 pandemic undeniably affected Pemex’s overall profitability, the fuel shortage caused by the geopolitical crisis in Ukraine boosted Pemex’s sales to its first positive quarter since the fourth quarter of 2020 at the beginning of 2022, though it’s only reported losses since. For some energy sector experts, like Monroy and Ramsés Pech, this indicates that Pemex is overly concentrated on maintaining extraction of crude oil and reducing assets rather than growing its operations. For this reason, Pemex has not been able to meet its yearly goals, especially as up to 85 percent of Pemex’s income comes from domestic sales and crude oil exports.

According to Brand Finance CEO Richard Haigh, as the crisis in Ukraine continues and the economic effects of the covid-19 pandemic still reverberate throughout the marketplace, oil companies have a challenging yet particularly germane opportunity to take advantage of the fluctuating market – but as clean energy becomes more sought-after and commonplace worldwide, it remains to be seen if Pemex’s dirty energy exports will be able to make the most of the volatile international oil and gas sector.