Mexico Oil Theft Just Keeps Getting Worse

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Despite government efforts, fuel theft has risen in Mexico, at a time when falling oil and gas prices are already impacting the nation’s economy and national budget.

Mexico state oil firm Pemex registered 1,211 illegal pipeline taps in the first quarter of 2015, up 58 percent from the same time period last year, reported Dinero, citing Pemex figures. Criminal groups later sell the stolen fuel at below-market prices to cartel-controlled gas stations and other buyers.

The Pemex numbers show that the northeastern border state of Tamaulipas saw the highest rate of fuel theft for the third year in a row. The state is home to the various criminal factions of the Zetas and the Gulf Cartel, both of which remain heavily involved in fuel theft according to a Wilson Center report (pdf) published earlier this year.

Click on the “2015” column in the chart below to see the states with the least and greatest number of oil theft incidents so far this year. 

 

The states of Guanajuato, Puebla, Tabasco and Jalisco also saw high rates of illegal pipeline taps during 2015’s first quarter. In Tabasco alone, fuel theft skyrocketed by 325 percent between the first quarter of 2014 to the same time period in 2015.

SEE ALSO: Mexico News and Profiles

InSight Crime Analysis

Organized crime’s growing impact on Mexico’s oil industry — Pemex estimates it lost $1.11 billion last year to fuel theft — coincides with falling oil prices and delayed foreign investment. The fuel sector is crucial to Mexico’s economy, and falling oil revenue has already prompted the Mexican government to cut national spending by more than $8 billion this year, with similar plans for 2016.

SEE ALSO: Coverage of Oil Theft

The administration of President Enrique Peña Nieto — who campaigned on a promise of reforming and revitalizing Mexico’s energy sector — has attempted to crack down on oil theft by making more arrests. The government has also implemented a new security program specifically meant to address the situation in Tamaulipas, which sees the highest rate of illegal pipeline taps in the country. Stamping out oil theft in Tamaulipas is ultimately contingent on gaining control of state’s security dynamic, which the Mexican government has so far been unable to do.

Pemex has also taken action against oil theft, announcing plans to only ship unrefined fuel through its pipelines, with final refining occurring at storage facilities. This is supposed to thwart thieves, who would be forced to refine the stolen fuel themselves in order to have a sellable product. While it is a novel solution, the results of this plan have yet to be seen and still fail to address the issue of internal corruption within Pemex.

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