What Happened: Mexican state-owned energy firm Petroleos Mexicanos (Pemex) has unveiled its 2019-2024 business plan, which includes boosting investments following some tax reductions, primarily in cheaper onshore and shallow-water fields, Bloomberg reported July 16.
Why It Matters: Pemex's shift to focus on investments in onshore and shallow-water fields is part of a broader strategy by the Mexican government under President Andres Manuel Lopez Obrador to empower Pemex and pursue a nationalistic energy policy. The Mexican government is planning to increase the country's oil production from 1.7 million barrels per day (bpd) to 2.7 million bpd by the end of Lopez Obrador's current term in 2024.
Background: Pemex announced in June that it was no longer planning to focus on investments in deepwater fields. The company is facing significant financial challenges and structural inefficiencies that recently resulted in a credit downgrading to "junk" status by Fitch Ratings.