From The Ashes Of Tragedy: Opportunity For Institutional Change In Mexico

In the wake of the oil explosion tragedy in Hidalgo, Mexican president Andres Manuel Lopez Obrador faces the first major crisis that may outline the course of his administration’s plans to tackle fuel theft and corruption in both the state-owned oil company Pemex and the federal government itself.

On January 18, in the small town of Tlahuelilpan, Hidalgo, hundreds of people ran to the local pipeline to collect fuel that was emptying from an open duct that Mexican authorities believe was tapped by criminals. Given the proximity of the pipeline burst to a major refinery at Tula mere miles away, the Mexican military was deployed with the intention of securing the area around the open duct and driving away civilians that were collecting oil, a notoriously dangerous enterprise.

Early in the afternoon, a massive explosion occurred amidst the crowd of people, engulfing dozens in flames while the military did what it could to evacuate the remainder of those not immediately caught in the blaze. It is estimated that upwards of 119 people perished in the explosion, with another 30 hospitalized.
The reason for this tragedy is quite simple: oil has become increasingly scarce throughout Mexico over the past few years, increasing the price of gasoline significantly. Some estimate that the price is 20 percent higher than in 2017 under former president Enrique Peña Nieto. In a country where nearly half the population lives below the poverty line and where gasoline is essential for those who drive for a living, as well as for those who are fortunate enough to own a vehicle, it is simply not possible to afford the rising costs of gasoline if there even is any at the local gas station.

Therefore, many resort to oil theft by opening ducts in pipelines that carry oil and extract it illegally. This has become such an issue that these thieves have been given the name huachicoleros, a Mexican slang term that originally referred to people who steal low-quality oil to sell it independent of the state-owned petroleum company Petroleros Mexicanos, or Pemex at much lower prices. What were once merely small bands of petty thieves who would steal oil in small quantities, these huachicoleros have evolved into armed, organized gangs, some even capable of establishing their own sites to secretly extract the fuel from pipelines or steal tank trucks to sell the fuel themselves.

At the epicenter of investigation is the Mexican state-run oil company Petroleros Mexicanos, or Pemex, under suspicion of systemic corruption for decades. Photo: Wikimedia Commons

Fuel theft is a lucrative industry in Mexico, with some experts estimating an annual revenue loss of around $3 billion for Pemex at the hands of these gangs. To complicate the issue of taking on fuel theft, huachicoleros tend to provide this stolen fuel to their local, impoverished communities throughout Mexico, which leads some to view them positively for providing both affordable fuel and new opportunities for employment. Many of these impoverished communities support the huachicoleros because they believe that the new economic activity has become a way to escape the crippling poverty to which the Mexican government has turned a blind eye for decades.

During the presidential campaign, Andres Manuel Lopez Obrador, better known by his initials AMLO, promised to take on the key issues of corruption, inequality and the economy that plague the nation among others. Shortly after assuming the presidency in early December, he decided to shift the distribution of fuel from flowing through Pemex pipelines in favor of deploying guarded trucks to mitigate illegal fuel tapping activity throughout the affected central states and improve security. In a press release a week prior to the tragic events of January 18, Pemex has pledged to comply with the Mexican government in combating fuel theft, which has led to many deaths in recent years.

This inevitably exacerbated fuel shortages in several states, including the capital. While this was met with sharp criticisms, many citizens have begun to warm up to the president’s plan, noting that he is following through on his promises to tackle the fuel shortage that has been occurring for years and is doing so publicly. As an assistant professor of government at Harvard University, Viridiana Rios says “Mexico is hungry for accountability and he [Lopez Obrador] is providing it.”

In addition to being transparent in his pledges, President Lopez Obrador’s administration has begun to investigate the circumstances that led to the tragedy of January 18th. Less than two weeks after the incident, the government has already announced that 3 officials from Pemex are under investigation for corruption in authorizing suspicious contracts for years. Pemex is not the only institution that is undergoing scrutiny however; even members of the Mexican government, both former and current, are fair game for investigation. While many believe that the blame for the tragedy rests solely on those who perished trying to steal fuel, Lopez Obrador countered by declaring that, “The people were abandoned, the people were impoverished”.  

Isolated gas stations such as these are vulnerable to gangs of fuel thieves, or ‘huachicoleros’ throughout central Mexico. Photo: Wikimedia Commons

A study by an international anti-corruption advocacy group, Transparency International, reveals that over half of Mexican citizens surveyed have paid bribes to government workers for public services.  It would be no surprise if both government and Pemex employees have engaged in corruption if this is true.  President Lopez Obrador stated during the presidential campaign last year that, “Corruption is not a cultural phenomenon, it’s the result of a regime in decline”, which makes his recent efforts to fulfill his mandate praiseworthy to the people.

It is not sufficient to say that corruption and fuel theft will end under the presidency of Lopez Obrador. However, both he and the Mexican populace understand the significance of acting proactively in addressing the institutional issue of corruption in order to alleviate many of the issues that affect Mexico today, especially the drug war and fuel theft. By remaining tenacious in the face of organized and institutional crime, and addressing the needs of the general population, Mexico may begin to turn in a more positive direction under the guidance of Andres Manuel Lopez Obrador, a president who might truly be “by the people, for the people”.

Alejandro Guzman 

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