Here is the full context of what he said.
There may be a basis in the case of some individuals, as perhaps when a male prostitute uses a condom, where this can be a first step in the direction of a moralization, a first assumption of responsibility, on the way toward recovering an awareness that not everything is allowed and that one cannot do whatever one wants. But it is not really the way to deal with the evil of HIV infection. That can really lie only in a humanization of sexuality.
Are you saying, then, that the Catholic Church is actually not opposed in principle to the use of condoms?
She of course does not regard it as a real or moral solution, but, in this or that case, there can be nonetheless, in the intention of reducing the risk of infection, a first step in a movement toward a different way, a more human way, of living sexuality.
To summarize: the Holy Father states that the best way to stop the spread of HIV is to humanize sexuality. He repeatedly denies that the distribution of condoms is a real solution. However, in what Mom, Dad, and I think is a very charitable and reasonable statement, the pope observes that a homosexual prostitute who bothers to protect his partners from disease has taken the first step towards inner conversion. Basically, if said prostitute uses a condom, it shows he’s beginning to understand that sex is not simply for his own animal gratification – that he is responsible for his partner’s well-being as well.
As Dr. Janet E. Smith explains:
An analogy: If someone was going to rob a bank and was determined to use a gun, it would better for that person to use a gun that had no bullets in it. It would reduce the likelihood of fatal injuries. But it is not the task of the Church to instruct potential bank robbers how to rob banks more safely and certainly not the task of the Church to support programs of providing potential bank robbers with guns that could not use bullets. Nonetheless, the intent of a bank robber to rob a bank in a way that is safer for the employees and customers of the bank may indicate an element of moral responsibility that could be a step towards eventual understanding of the immorality of bank robbing.
Sheesh! The self-serving mainstream media did this message warping with Vatican II as well, and the Church is still suffering from the consequences.