Mexico Fuel Theft Worth $1 Bn in 2014

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The theft of fuel from Mexico’s state-owned oil company Pemex has risen by around 33 percent this year, turning into a billion-dollar source of income for organized crime — a trade facilitated by corrupt employees. 

So far in 2014, Pemex has reported the existence of 2,481 illegal taps in pipelines, which represents an increase of a third compared to the same period in 2013, according to Animal Politico. The company recently estimated it had lost some 7.5 million barrels of fuel valued at more than $1 billion to theft this year. 

The Zetas and the Gulf Cartel are deeply involved in the trade, reported the Associated Press. Both cartels are important operators in Tamaulipas state, where Pemex reported more than a fifth of the breaches had been found. 

Authorities in Mexico believe the criminals involved in the trade are either relying on support from Pemex employees or have themselves infiltrated the company, according to the Associated Press.

“It would be impossible for this to be done without collaboration, without information on the timing and the oil flow levels,” remarked a federal legislator who is drafting a law to increase penalties for oil theft. 

Evidence of criminal infiltration into Pemex was seen in the August arrest of a suspected Gulf Cartel leader in Tampico, Tamaulipas, who was allegedly involved in fuel theft and was carrying a false Pemex employee identification card at the time of his capture.

InSight Crime Analysis

Pemex’s self-reported losses are significantly lower than figures reported from an outside investigation by VICE, which claimed the oil giant now loses $5 billion annually from fuel theft. This indicates the true scope of the trade may be difficult to get a handle on. What the numbers make clear, however, is that it is growing rapidly. 

This growth has been spurred partly by the movement of major actors with an international reach — like the Zetas and Gulf Cartel — into a trade traditionally controlled by smaller gangs. Those involved have also been developing sophisticated techniques, such as trafficking crude oil directly to US refineries.

SEE ALSO: Coverage of Oil Theft

The idea that these cartels are also relying on support from Pemex employees is both highly plausible and troublesome. Pemex generates up to one third of Mexico’s revenue, meaning that oil theft poses a significant economic threat to the country, in addition to the obvious security concerns. Zetas control of government territory in Mexico’s key oil producing regions is already threatening to derail Mexican oil reforms aimed at pushing economic development, and if the cartel is counting on inside assistance, fuel theft will be harder to combat.

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