MEXICO CITY (Reuters) - Yields on the debt of Mexican state-run oil company Pemex rose sharply this week after the company failed during presentations in New York to lay out a clear plan to reduce debt and increase output, analysts said.

FILE PHOTO: A digital LED price sign of state-owned company Petroleos Mexicanos (PEMEX) shows their gasoline prices at a gas station in Monterrey, Mexico, August 8, 2018. Picture taken August 8, 2018. REUTERS/Daniel Becerril/File Photo

Pemex faces the possibility of a credit ratings downgrade due to costly proposals by the new government of leftist President Andres Manuel Lopez Obrador that include plans to build a new refinery and upgrade existing ones.

Half a dozen investors and analysts who either attended or were briefed on presentations in New York by the company’s new chief financial officer, Alberto Velazquez, said they were unconvinced by the plan to turn around Pemex.

Mexican financial assets slumped late last year after Lopez Obrador canceled a partly-built airport project. They have regained ground in recent weeks, in part due to relief about an austere budget announced by his economic team.

Markets are watching closely for signs of how the new president will manage Latin America’s second largest economy.

“It was a poor presentation and it is at a time when the market is increasingly sensitive about anything to do with Mexico,” Pablo Cisilino, a portfolio manager at Stone Harbor, told capital markets publication Refinitiv IFR.

Pemex did not immediately respond for a request for comment.

The yield on Pemex’s 6.5 percent coupon dollar bond due January 2029 spiked on Thursday and Friday, closing 35 basis points higher on Friday compared to Wednesday’s close, according to Refinitiv data.

Both Pemex and the government were expected to try soon to issue debt on international markets, and the two-day road show launched on Wednesday by Velazquez and officials from Mexico’s finance ministry was a bid to ease worries.

“It backfired,” said one New York analyst, who spoke on condition of anonymity.

Petroleos Mexicanos [PEMX.UL], as the firm is formally known, has seen crude output drop for more than a decade as its major fields age and it has struggled to replenish reserves.

Another New York-based economist who attended the presentation agreed it did not go well for Pemex and said that the situation was “worrisome.”

“They didn’t know how to answer clearly,” said the economist, who asked not to be named. “We’ll see how they do.”