Profitability of Petróleos Mexicanos: determinants and discussions on the public budget

Abstract

Mexico’s oil market sharp fluctuations in the last decade have had a direct impact in the industry’s profitability. The current study revises the factors that influence the profitability behavior of Pemex. Likewise, a brief analysis on the effect that those factors have upon total tax receipts and their possible impact on public budget calculation is also carried out. A multiple linear regression econometric model with data from 2005 to 2016 is used. The results show that the price of a crude oil barrel, the total assets and net exports have an effect on the company’s profitability. The variables identified were found to have a lesser impact on budget revenues because not many of them were considered in the adoption of 2013’s energy reform.