March 12, 2020 / 8:09 PM / 22 days ago

Pemex receives first payout from oil hedge amid low crude prices

The logo of Mexican oil company Pemex is pictured at Reynosa refinery, in Tamaulipas state, Mexico February 28, 2020. REUTERS/Daniel Becerril

MEXICO CITY (Reuters) - Mexican state oil firm Pemex said on Thursday it had received the first payment from a hedging program protecting its revenue from price swings, and that it has $7.85 billion available in credit lines, and will continue honoring debts to suppliers.

Global oil prices have fallen to historic lows in recent days amid declining demand due to the coronavirus outbreak and lack of agreement between large producers Saudi Arabia and Russia over a production cut.

“Since February, protection contracted by Pemex has been activated. On March 6, Pemex received he first monthly payment from the insurance,” the company said in a statement.

Reporting by Ana Isabel Martinez

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