Security experts have praised López Obrador’s willingness to take on fuel theft, an issue that was largely ignored under previous administrations, even though the problem was spiralling out of control. But two nights ago, I watched a political commentary program on TV, and the order of the day for the anti-AMLO segment of Mexico’s population is to scream bloody murder because of the gas shortages. (“The people, the people… the POOR people,” lamented one of the panel members.)
Many Mexicans and international residents of this country do not understand how the gas is stolen and why there are such shortages now. Today I will attempt to explain this calamity as best I can.
Those who physically carry out the theft are mostly the poor bottom-feeders of “illicit groups”. They are called, huachicoleros. The closest “translation” I can come up with is “moonshiners” (I suppose because they try to stay hidden while they “do what they do”)
They know exactly where to find the product they need because their employers and their “associates” bribe Pemex employees to tell them what kind of gasoline runs through which duct. (It doesn’t take too much imagination to figure out who the “associates”are.) To avoid catastrophic explosions the huachicolros must also know the pressure ratio inside the oil duct (Blow-ups happen more regularly than is reported.) During the peak of the huachicolero operation, it is estimated that 60,000 barrels of gasoline were stolen every day.
Once the pressure and pumping specifics of the selected oil duct have been confirmed, the huachicoleros locate an unguarded spot along the route. Their support vehicles get into place. And with armed guards watching the area, the “experts” quickly drill a hole most of the way through the pipe, and then, so as not to cause a spark, they used a rubber mallet to crack open the last bit. Quickly a valve is inserted into the opening. This in turn is connected to a hose, that is attached to a tanker truck. Apparently, the average procedure takes about 20 minutes.
The stolen gasoline is then trucked to clandestine depositories, and from these places, sold to gas stations for purchase by the public, or to companies with large fleets who use the illegal gas to fuel their convoys, and keep their expenses down.
Pemex used to be the highest revenue producer in Mexico, but with progressively more and more privatization, income from “the people’s oil company” dropped lower; and once the huachicoleros stepped up their activities, the earnings plummeted even further.
The blame lies with PEMEX big-shots and the politicians, who have actively ignored security and allowed wholesale theft. As well, in recent years, some of the country’s most dangerous drug cartels have become involved in fuel theft.
Just this week, the Army found a two kilometre “side duct” on a major pipeline, leading to a clandestine storage center. This gas was purchased at below market cost and without being taxed. Several hundred stations around the country, that purportedly bought the illegal product, have closed for lack of gas to sell. Some critics claim that although AMLO may have good intentions, he should have “done this differently”. But they never explain just “how” he might have done so.
It is estimated that $7.4 billion in fuel has been stolen since 2016. The cartels are unlikely to accept such a massive losses in revenue without responding.
However, this practise is robbing the nation on a massive scale, and thus cuts government funding for all the state expenses. Like health care, building highways, old-age pensions. It has to be stopped.
Yes, there is a gasoline shortage right now. It may last longer than initially anticipated, but in the end, it should reflect more revenue for the state, without much affecting the “regular” consumers’ cost for gasoline. The old guard can whine all they want, but I suspect that the complaints are more about the loss of income from their “side jobs” than from their concern about “the people of Mexico”.
And one final comment. I do feel sorry for the states without enough gas, but we need to support our president in his efforts to clean up the many messes in Mexico. The way the newscasters carry on seems like a plea to get themselves back in the limelight, and mostly supports their own interests.
Among the information sources for this post is: Mexfiles. The author usually proves to be spot-on. Well reported Richard!