Mexico has asked top Wall Street banks to submit quotes for its giant oil hedging program, sources familiar with the matter said on Friday, while trading in crude oil options has increased this week ahead of the megadeal.
FILE PHOTO: General view shows Mexican state oil firm Pemex's Cadereyta refinery, in Cadereyta, on the outskirts of Monterrey, Mexico April 20, 2020. REUTERS/Daniel Becerril/File Photo
Every year, Mexico buys as much as $1 billion in financial contracts, the world’s largest oil hedge program, to protect its oil revenues. Bankers and officials on both sides of the deal expect a smaller hedge this year because the options used to protect oil profits are more expensive than last year.
Having the hedge in place protected Mexico from the plunge. The 2020 hedge, arranged in 2019, was completed at $49 a barrel, according to the country’s finance ministry, and Mexican President Andres Manuel Lopez Obrador said in April that the hedge would yield roughly 150 billion pesos . Trade shops and banks based in Europe and the United States have been active buyers of implied volatility options this week, market sources said. That is a signal that dealers are preparing for the extensive buying that comes with the finance ministry’s purchases, those sources said.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
In Mexico, women's murders have spiked during coronavirus pandemicActivists have long worried that the increased confinement of families to their homes would increase killings of women, and they indeed grew.
Read more »
Child abduction, forced labor scandal widens in south MexicoA child-abduction scandal in southern Mexico is widening as prosecutors release additional evidence that an adult child thief apparently used other children to help abduct a missing 2 ½ year-old boy.
Read more »
Mexico to boost worker pensions, strikes deal with employersMexican workers will get a major boost in their retirement benefits after the government and private sector ironed out the details of a pension reform that is expected to become law by early next year, the Finance Ministry said on Wednesday.
Read more »
Emigrants send dollars home to Mexico -- and virus warningsNEW YORK (AP) — In the weeks he spent flat on his back in his Brooklyn bunk, wracked with pain and struggling to breathe, Axayacatl Figueroa could think of nothing but the small town and the...
Read more »
Emigrants send dollars home to Mexico -- and virus warningsNEW YORK (AP) — In the weeks he spent flat on his back in his Brooklyn bunk, wracked with pain and struggling to breathe, Axayacatl Figueroa could think of nothing but the small town and the...
Read more »
Emigrants send dollars home to Mexico -- and virus warningsNEW YORK (AP) — In the weeks he spent flat on his back in his Brooklyn bunk, wracked with pain and struggling to breathe, Axayacatl Figueroa could think of nothing but the small town and the...
Read more »