Drinking Water in Loreto
You should probably not drink the water out of a faucet in Loreto. The water is not that bad, but why take the chance. If you are staying here for a while, then its best to get the 5 gallon tubs for $1.00 and get a water dispenser from the store.
When you go out. always order water from a bottle. Its ok to order ice from a "bigger restaurant" since they use filtered water and/or use bottled water for ice. When in doubt just politely ask.