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Mexico Eyes Options Beyond Pemex for $7 Billion Fund Purchase

  • Funds may be used to pay down sovereign debt, two people say
  • Government said this month Pemex refinancing process had begun
President of Mexico Andres Manuel Lopez Obrador speaks during the annual shout of independence (Grito de Independencia) as part of the independence day celebrations on September 16, 2021 in Mexico City, Mexico. (Photo by Hector Vivas/Getty Images)
President of Mexico Andres Manuel Lopez Obrador speaks during the annual shout of independence (Grito de Independencia) as part of the independence day celebrations on September 16, 2021 in Mexico City, Mexico. (Photo by Hector Vivas/Getty Images)

Mexico’s government is considering using the $7 billion of international reserves it bought from the central bank this month for purposes other than prepaying debt of the nation’s oil giant Pemex, according to three people with knowledge of the matter. 

Mexico purchased the reserves the same week President Andres Manuel Lopez Obrador said his administration had begun a process to refinance expensive public debt, with his spokesman saying that he was referring to debt owned by Petroleos Mexicanos, as Pemex is known. The move was the latest twist in an attempt by Lopez Obrador to aid the state-owned company, which is the world’s most indebted oil major.