Bright 2009 For Pemex, But Clouds On Horizon

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BMI View: We are cautiously optimistic that the government's decision to hedge oil exports at US$70/bbl in 2009 will allow a much needed capital injection into state-owned oil giant Petróleos Mexicanos. However, despite the short-term opportunities, we hold that without further energy reforms down the line, the longer-term prospects for Mexico's oil industry are bleak, which is bad news for the country's fiscal accounts beyond 2009.