Pemex's Oil Production -- Update -- February 21, 2021

Some years ago I was taken to task by a reader suggesting I did not know the difference between petroleum and oil (which, at that time, was true ... LOL). 

But it turns out I might not have been the only one.  Irina Slav is pointing out that Mexico is reporting its crude oil production has increased year-over-year.

It turns out there's a bit of smoke and mirrors here. 

Mexico’s Pemex reported its oil production grew last year, for the first time in fifteen years. However, there’s a big catch—the increase was only a result of how the company is counting barrels, Bloomberg reports.

And anyone trying to compare production figures from year to year will run into a problem of comparing apples to oranges.

The change in calculations is pretty straightforward; Pemex simply started adding gas condensate output to the total crude oil production it counts.

Without condensates, Pemex and its partners produced 1.66 million bpd of oil last year, down 1 percent on 2019.

With condensates, oil production was 0.23 percent higher last year.

The boost was made possible by new condensate discoveries that added 46,000 barrels daily to Pemex’s condensate production: a twofold increase. A positive as this is, it is questionable whether the condensate production increase should actually count towards the company’s total oil production, which it has been struggling to boost after a persistent decline.

More from the linked article:

• PEMEX: most heavily indebted oil company in the world; a burden of $100 billion;
• PEMEX has revised down its forecast of this year's production, from 2.027 million bpd to 1.857 bpd (an 8% cut in the forecast)
  
• Mexico has cut PEMEX tax rate from 65 percent to 58 percent and may cut it to 54 percent
• probably won't help