President-elect Claudia Sheinbaum delays decision on Pemex leadership as speculation mounts, with potential candidates facing unprecedented challenges in turning around Mexico’s debt-laden oil giant.
As Mexico’s president-elect Claudia Sheinbaum prepares to take office, one of her most critical decisions remains pending: naming the next chief executive of Petroleos Mexicanos (Pemex). The role, which has proven to be a career-ending position for many, is more challenging than ever. Whoever steps into the job will face the enormous task of reviving an oil company that has seen its production halved over the past two decades and is burdened with nearly $100 billion in debt, making it the world’s most indebted oil producer.
Pemex’s troubles are compounded by deteriorating infrastructure, including accidents, oil spills, and methane leaks. The company’s survival largely depends on government handouts, with outgoing President Andrés Manuel López Obrador (AMLO) having provided up to $80 billion in capital injections and tax breaks during his tenure.
Sheinbaum, who announced earlier this week that she would soon reveal her pick for Pemex’s leadership, has kept her choice under wraps, leading to widespread speculation. Early contenders include Treasury Undersecretary Gabriel Yorio and Jorge Islas, an academic and energy advisor to Sheinbaum. Notably, Lázaro Cárdenas Batel, after reviewing Pemex’s financial state, declined the position in favor of becoming Sheinbaum’s chief of staff. Current Pemex CEO Octavio Romero Oropeza also remains a potential candidate, reportedly favored by AMLO.
Recent discussions have increasingly focused on Victor Rodriguez Padilla, a physicist and engineer with a doctorate in energy economics, who has been an advocate for state-owned enterprises for over 25 years. Rodriguez, who co-authored a paper with Sheinbaum in 2009 on Mexico’s energy policies, is seen as a strong contender. However, he has yet to comment publicly on the possibility.
Regardless of who is ultimately selected, the next Pemex chief will face a monumental task. Last quarter, the company reported its worst financial loss since the global pandemic, underscoring the urgency of turning the company around. Sheinbaum has outlined plans for Pemex to refinance its debt and expand into new ventures such as petrochemical production, lithium mining, and electric vehicle infrastructure. Collaboration with the Finance Ministry will be crucial, as government support remains essential to keeping Pemex afloat.
Analysts are also watching how the new leadership will navigate relations with the private sector. While Pemex recently partnered with private drillers to boost offshore production, Sheinbaum, echoing AMLO’s position, has vowed to keep state-owned enterprises at the heart of Mexico’s energy strategy. Rodriguez, if chosen, is expected to maintain this approach, which could have significant implications for private sector involvement in Mexico’s energy sector.
In the face of these challenges, the selection of Pemex’s next leader will be a defining moment for Sheinbaum’s administration. The decision will not only shape the future of Mexico’s most important state-owned enterprise but also signal the direction of the country’s energy policy for years to come.
By Orlando J. Gutiérrez