Courtesy of The Financial Times, a look at  Pemex and Petrobras:

Shares of Petrobras fell sharply on Monday after the Brazilian state company reported a 12 per cent year-on-year decline in third-quarter net profit to $2.7bn.

The next day Pemex, the Mexican state oil company, reported a $1.9bn quarterly net profit. But progress was huge: a year earlier, Pemex reported a $6.2bn net loss.

Pemex was boosted during the quarter by a 4.3 per cent increase in revenue to $31.8bn, as well as by gains in financial operations. While production of crude and natural gas was about flat, refinery and gas-processing units showed modest increases in output.

By contrast, Petrobras’s third-quarter results were dragged down by weakness in refining, a 65 per cent increase in exploration costs and a 2.3 per cent year-on-year decline in production of crude and natural gas.

Yet the improvement in Pemex made no impact, however, on the price of its shares, because it doesn’t have any. Pemex is much more like a government department than a business, state-owned or otherwise.

But Enrique Peña Nieto, who is due to be inaugurated as Mexico’s president on December 1, has indicated that he wants Pemex to adopt something like the Petrobras model, where the state company competes in its home and foreign markets with others from the rest of the world.

Pemex enjoys a state monopoly in Mexico, which absorbs all of its capital spending. So no overseas ventures for the Mexican company and no competitors on the home front.

How exactly Peña Nieto plans to change Pemex is far from clear. In broad terms, though, he has spoken not of a straightforward privatization but rather of a Mexican market in which Pemex competes with the private sector as well as state companies from other countries.

That may sound straightforward. But, though many Mexicans support Peña Nieto’s view, others believe that all oil and gas must remain state property, as the Constitution currently demands.

The 1938 oil nationalization has many vehement supporters. And the recent improvement in Pemex’s performance — above all two major deep-water discoveries that confounded many critics — has convinced them that there is little need for change.

Peña Nieto and his team are going to burn plenty of oil — of the midnight variety — before they find the right formula.