Pemex Woes Trigger 2,000 Provider Job Cuts as Boom Turns to Bust

Petroleos Mexicanos’ woes are hitting home for suppliers that less than two years back were preparing for an oil boom.

Cotemar, one of Mexico’s largest oil service providers, will lay off as many as 2,000 workers after Pemex suspended two of the company’s contracts amid massive budget reductions, according to a company official, asking not to be named because of company policy.

Pemex is slashing 100 billion pesos ($5.7 billion) of spending and freezing several exploration and production projects as it struggles with the collapse of oil prices, declining output and ballooning debt. The austerity is a stark contrast to the tens of billions of dollars in annual investment anticipated when President Enrique Pena Nieto formally opened the state-controlled energy industry to private investment in 2014.

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