A $6 Billion Windfall: Mexico's Massive Oil Hedge Is Paying Off
- Latin American country runs the largest sovereign oil hedge
- Mexico guaranteed the 2020 price of its crude at $49 a barrel
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Mexico is on track to cash in on a $6 billion windfall once its massive insurance program against low oil prices kicks in following a dramatic plunge in prices, President Andres Manuel Lopez Obrador said on Wednesday.
For the past two decades, Mexico has locked in its oil revenue via put options it buys from a small group of investment banks and oil companies in what’s considered Wall Street’s largest -- and most closely guarded -- annual oil deal.