HomeNewsBriefMexico Fuel Theft Remains Lucrative Despite Oil Price Drop
BRIEF

Mexico Fuel Theft Remains Lucrative Despite Oil Price Drop

MEXICO / 15 MAR 2016 BY LUCIA BIRD EN

The cost of oil theft for Mexico's state-owned oil company Pemex continues to increase year on year, suggesting rock-bottom prices have done little to deter oil thieves.

During the recent International Congress on the Prevention of Emerging Crimes (Congreso Internacional sobre Prevención de Delitos Emergentes), representatives from Mexican oil company Petróleos Mexicanos (Pemex) estimated organized crime steals 23,500 barrels of oil per day from its pipelines, representing losses of 21 billion pesos (roughly $1.17 billion), reported Proceso.

As global oil prices have fallen (following their 2014 peak oil prices have dropped over 70 percent), the reported incidence of oil theft in Mexico has continued to increase.

Pemex officials estimated losses due to oil theft during 2014 at 19 billion pesos (roughly $1.2 billion at the time), and the company's most recent approximation suggests 8.5 million barrels are stolen per year -- up from its 2014 estimate of 7.5 million.

Fuel theft has proven a consistent challenge for Mexican officials, with criminal groups such as the Zetas establishing sophisticated and lucrative oil theft rings in recent years.

InSight Crime Analysis

During a discussion on the issue of fuel theft at the International Congress, Pemex representatives struck a positive note, expressing optimism recent legal reforms in Mexico toughening penalties for oil theft would help combat the problem. However, as InSight Crime has previously noted, more severe penalties are unlikely to provide an effective deterrent to fuel smugglers, as chances of being apprehended and prosecuted remain low.

SEE ALSO: Coverage of Oil Theft

Neither does Pemex appear able to tackle the issue itself. The company's ongoing anti-tapping measures are costly -- one such measure, the improvement of its surveillance systems, was projected to cost 2.9 billion pesos ($161 million) across 2015 and 2016. Yet, with the drop in oil prices, Pemex reported its biggest quarterly loss in company history in October 2015, and plans to cut $5.5 billion from to its 2016 budget.

Given previous struggles at reducing the incidence of oil theft, future budget cuts raise serious questions about Pemex's ability to adequately fund anti-tapping strategies moving forward, thereby rendering its pipelines increasingly vulnerable to organized crime.

share icon icon icon

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

What are your thoughts? Click here to send InSight Crime your comments.

We encourage readers to copy and distribute our work for non-commercial purposes, with attribution to InSight Crime in the byline and links to the original at both the top and bottom of the article. Check the Creative Commons website for more details of how to share our work, and please send us an email if you use an article.

Was this content helpful?

We want to sustain Latin America’s largest organized crime database, but in order to do so, we need resources.

DONATE

Related Content

MEXICO / 8 DEC 2014

As Mexico's president struggles to claw back approval ratings through new security measures announced in the epicenter of his current…

JALISCO CARTEL / 21 FEB 2017

American officials are reporting that the Jalisco Cartel - New Generation (CJNG) has expanded its trafficking operations in the United…

ARMS TRAFFICKING / 25 NOV 2011

The trafficking of weapons over the U.S.-Mexico border is well-documented -- lesser known but also significant is the sale of…

About InSight Crime

THE ORGANIZATION

Colombia’s Fragile Path to Peace Begins to Take Shape

26 AUG 2022

InSight Crime is charting the progress of President Gustavo Petro’s agenda as he looks to revolutionize Colombia’s security policy, opening dialogue with guerrillas, reforming the military and police, and…

THE ORGANIZATION

Bombing Signals Intensification of Violence in Ecuador

19 AUG 2022

This week’s bombing in Guayaquil, Ecuador, which left at least five people dead and many others injured, was covered by media around the globe. Several outlets looked to InSight Crime for expert knowledge on…

THE ORGANIZATION

Criminal Enterprise on the High Seas

12 AUG 2022

Last week, InSight Crime published the second half of an extensive investigation into Illegal, Unreported and Unregulated (IUU) fishing that plagues the waters of nine Latin American countries. Among the stories were how…

THE ORGANIZATION

Oceans Pillaged in Central America and the Caribbean

5 AUG 2022

Last week, InSight Crime published the first installment of a nine-part investigation uncovering the hidden depths of Illegal, Unreported and Unregulated (IUU) fishing in Latin America. The first installment covered Central America and…

THE ORGANIZATION

Venezuela’s Tren de Aragua Becomes Truly Transnational

29 JUL 2022

This week, InSight Crime published a deep dive into the total control that Venezuelan mega-gang, Tren de Aragua, has over the lives of those it smuggles between Venezuela and Chile…