According to US News.com, fuel theft is fast becoming one of Mexico’s most pressing economic and security dilemmas, sapping more than $1 billion in annual revenue from state coffers, terrorizing workers and deterring private investment in aging refineries that the government, following a 2014 energy reform, hoped instead would be thriving with foreign capital.
Because of government offensives that toppled narco kingpins in recent years, Mexico’s drug cartels have splintered and are eager for new sources of revenue. Now, their increasingly dominant role as fuel thieves pits two of the country’s biggest industries – narcotics and oil – against one another.
The cash-rich cartels, believed by the Mexican government to generate well over $21 billion each year, are an increasing threat to Pemex, which in 2016 reported revenue of about $52 billion and generates about a fifth of government income.
A sign is pictured of Mexico’s national oil company Pemex’s refinery in Salamanca, in Guanajuato state, Mexico September 19, 2017. Picture taken September 19, 2017. REUTERS/Edgard Garrido Reuters
“The business is more profitable than drug trafficking because it implies less risk,” said Georgina Trujillo, a ruling party congresswoman who heads the lower house energy commission.
“You don’t have to risk crossing the border to look for a market,” she added. “We all consume gasoline. We don’t all consume drugs.”
Pemex did not respond to detailed questions from Reuters about the cartels and fuel theft. Among other questions, Reuters asked about the cartels’ impact on the refineries, Pemex’s security measures and how the company responds to extortion and violence against its employees.
One senior Pemex refining executive, who asked not to be identified, said, “We worry about the influence of organized crime,” but would not discuss the issue further.
Fuel theft is not new or unique to Mexico. But cartels are taking it to calamitous new dimensions and, in the process, bolstering their bottom line.
