MEXICO CITY, MEXICO (By S&P Global Ratings, 13.May.2026, Words: 789) — S&P Global Ratings revised its rating outlooks on state-owned Petroleos Mexicanos (Pemex) and Comision Federal de Electricidad (CFE) to negative to mirror the same rating action on Mexico.
The negative rating outlook on Mexico reflects the risk of very slow fiscal consolidation, largely due to low economic growth, resulting in a faster-than-expected buildup in government debt levels and a higher interest burden. The expected continued substantial fiscal support for Pemex and CFE could continue to aggravate Mexico’s fiscal rigidities. An unexpected worsening of Mexico’s close trade and other economic links with the U.S. could also weaken the country’s currently solid external position.
Our ratings on Pemex continue to reflect our expectation of an almost certain likelihood of government support in a scenario of financial distress. The likelihood of support derives from our view of Pemex’s integral link with the government and its critical role in economic, social, and political objectives; our expectation that the government will continue to participate in Pemex’s board discussions; and our view that Pemex will continue to execute its financing strategy in close coordination with the Ministry of Finance and Public Credit.
Pemex received approximately $69.8 billion in government support between 2019 and 2025, and the Sheinbaum administration has been implementing different mechanisms to aid the company. Nevertheless, Pemex’s stand-alone credit profile remains ‘ccc+’, reflecting our belief that its capital structure is unsustainable, given its weak liquidity and high leverage. Pemex had a debt-to-EBITDA ratio of 5.8x and posted negative free operating cash flow in the first quarter of 2026.
Additionally, we revised the rating outlooks on Pemex’s subsidiaries P.M.I. Trading DAC (BBB/Negative/–), PMI Norteamerica S.A. de C.V. (BBB/ Negative/–), and Mex Gas Supply S.L. (BBB/ Negative/–) to negative from stable, given we believe they are core to Pemex and its consolidated operations. We also revised the outlook on Deer Park Refining L.P. (BBB-/Negative/A-3) to negative from stable to reflect that it remains a highly strategic subsidiary for Pemex, vital to refined product sales and international trade.
Our ratings on CFE likewise continue to reflect our expectation of an almost certain likelihood of government support in a scenario of financial distress. In our view, CFE continues to play a critical role in public policy for the Mexican government–it provides a key service as the only company allowed by law to transmit and distribute electricity in Mexico and own strategic assets for the national electric grid. Moreover, CFE is the only company that provides electricity to low-consumption residential users and is the main provider to high-consumption users. We expect the company to remain a leading player in the country’s power generation industry.
We view CFE and the Mexican government as sharing an integral link, considering that the sovereign is the sole owner of CFE and that we expect the government will maintain control of the company, appoint its senior management, and drive its strategic and financial policies. We therefore equalize the rating on CFE with that on the sovereign.
We also revised our rating outlook to negative from stable on CFE International LLC (CFEi; BBB/Negative/–), which we consider to be a core subsidiary of CFE. We continue to view CFEi’s operations as fully integrated into CFE. CFEi focuses on ensuring that Mexico, and specifically CFE, has a sufficient supply of natural gas for power generation. Consequently, our rating on CFEi moves in tandem with that on its parent.
Further, we revised the rating outlook on CFE Fibra E (BBB/Negative/–) to negative from stable. CFE Fibra E depends on the transmission business of CFE, which is highly regulated and dependent on regulatory-approved rate adjustments; hence, we think the company’s performance could weaken in the case of regulatory or political interference. Consequently, the sovereign rating on Mexico caps the rating on CFE Fibra E. The company, established in 2018, is an investment vehicle created under Mexican law by CFE, and it supports the utility’s investment program in the transmission sector. It is managed by CFE’s affiliate, CFECapital S. de R.L. de C.V. (not rated).
The negative rating outlooks on Pemex, CFE, and their subsidiaries reflect that on the sovereign. We expect Pemex and CFE to maintain close relationships with the government, where the government will remain highly involved in all strategic decisions to execute its energy policy. Therefore, our ratings on Pemex, CFE, and their subsidiaries will continue to move in tandem with those on the sovereign.
We could lower the ratings on these companies in the next 12 -24 months if we took a similar rating action on Mexico.
Similarly, we could revise the rating outlooks on these companies to stable in the next 12-24 months if we took a similar rating action on Mexico.
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