En Español



Very usefull links



PW
Bookstore





News links

AP

AFP

Aljazeera

Dow Jones

Oil price

Reuters

Bloomberg

Views and News
from
Norway

 

 

 

 

Mexico invested $1.25 billion on the world's biggest oil hedge


Mexico's Meade on Catastrophe Bonds and Oil Hedge. - Watch video

By Nacha Cattan

MEXICO CITY
Petroleumworld 11 01 2017

Mexico spent about 24 billion pesos ($1.25 billion) to lock in prices of oil exports for next year, or more than 21 percent what it paid to hedge crude a year ago, according to Finance Ministry data.

The cost for buying put options on the market as of the end of the third quarter came to more than the $1.03 billion spent last year to protect against a drop in oil revenue, according to data released in the quarterly budget balance. In recent years, Mexico has spent an average $1 billion buying the hedges.

Deputy Finance Minister Vanessa Rubio said in mid October that Mexico completed its annual oil hedge for 2018. Mexico buys put options from a small group of investment banks each year in what's considered Wall Street's largest -- and best-concealed -- annual oil hedge.

Mexico Finance Ministry proposed a 2018 public budget in September projecting oil exports revenue at $46 per barrel. Lawmakers increased that assumption earlier this month to $48.5.

Uncovering the secret history of Wall Street's biggest oil trade, Click here

Finance Minister Jose Antonio Meade said in an interview in September that Mexico would likely expand its oil hedge marginally for 2018 as it liberalizes gasoline prices, while the cost for the government to protect crude exports against a drastic drop in prices would be about the same as for this year.

The Mexican oil hedge runs from the beginning of December until the end of November. The country has made money three times on the hedge since it started to lock-in prices every year in 2000, including a record payout of $6.4 billion in 2015 after oil prices crashed


Story by Nacha Cattan from Bloomberg.

bloomberg.com 10 31 2017

We invite all our readers to share with us
their views and comments about this article.

Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels



Nov 13-14 ;
Mexico City, Mexico

 

 

 

 

 

TOP

Contact: editor@petroleumworld.com,

Editor & Publisher:Elio Ohep/
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2017, Petroleumworld   / Elio Ohep - All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.