Halliburton Warns Mexico Oil Decline Requires Reactivation, But Pemex Still Owes Suppliers

Halliburton says declining oil output in Mexico is creating pressure to restart oilfield services work, but ongoing payment delays from Pemex continue to stall activity. Mexico’s crude production fell 8.4% in May.

(Reuters) — U.S. oilfield service provider Halliburton on July 22 said Mexico's crude production decline rates are creating pressure for a reactivation of business amid long delays from state-run Pemex to pay its suppliers.

Output of crude and condensate by Pemex, the largest producer in the country, fell 8.4% in May to 1.64 million barrels per day, according to official figures.

Oilfield service companies have significantly decreased activities because of the lack of payments from Pemex, the world's most indebted energy company.

Halliburton said issues related to payments from Pemex have not been resolved yet.

The Mexican association that groups foreign oil services companies warned last month that many of these firms may have to stop operations as early as July.

Halliburton, which posted second-quarter earnings on Tuesday, said it expects its full-year international revenue to decline by mid-single digits, year on year, primarily driven by activity reductions in Saudi Arabia and Mexico.