What is the role of Pemex in Mexico’s economy?

Petróleos Mexicanos (Pemex) is a state-owned company that serves as a central pillar of Mexico’s economy, responsible for the exploration, production, refining, and distribution of crude oil, natural gas, and petroleum products.21

Historically, Pemex has been a vital source of revenue for the federal government, at times contributing up to one-third of the national budget. While its relative contribution to the national GDP and federal revenue declined in the 21st century due to falling production and increased competition, it remains a major exporter and a key driver of foreign-exchange earnings.21

Following its nationalization in 1938, Pemex held a monopoly over the industry, which was later challenged by energy reforms in 2013 that allowed for private and foreign investment. However, recent policy shifts under President Andrés Manuel López Obrador have sought to restore the company's dominance, including legislative changes to its regulatory environment to reinvigorate its market power. Additionally, Pemex supports the domestic economy by fueling the majority of Mexico’s electric power generation through oil and natural gas.21