Peru’s government on Monday authorized state oil company Petroperu to seek up to $2 billion in state-backed loans to sustain operations and avoid disruptions to fuel production amid mounting financial pressure.
The emergency decree, published by the government in Lima, allows the Energy and Mines Ministry to guarantee the financing through contingent liabilities with local and international lenders, while also approving up to $500 million in short-term support.
The move comes as Petroperu struggles with heavy debt, high crude prices linked to the Iran conflict, and ongoing restructuring challenges that have threatened the company’s ability to maintain fuel supplies nationwide.
Interim President Jose Balcazar described the measure as exceptional and necessary to safeguard Peru’s hydrocarbon supply chain and energy security.
Prime Minister Luis Arroyo said the financing would come from international banks and be managed through a state-guaranteed trust overseen by Proinversion, Peru’s private investment agency.
Arroyo stressed that the package would not affect Peru’s public debt or rely on taxpayer funds, saying the money would be used strictly to secure crude oil purchases and maintain fuel distribution.
Petroperu lost its investment-grade credit rating in 2022 after a financial crisis tied largely to the costly modernization of its Talara refinery, whose final price exceeded $6 billion.
The state-owned company has received roughly $5.3 billion in direct and indirect government support over the past three years as authorities sought to keep operations running.
Petroperu currently carries debt estimated at $7.9 billion, nearly half of it short-term, and reported losses of $774 million in 2025 amid worsening financial conditions.
The company also appointed its fourth chairman since December 2025 earlier this month, underscoring continued management instability as Peru races to stabilize its strategic energy firm.