Cartels Exploit Intermediaries in Mexico’s Oil and Gas Industry
Mexican drug cartels, such as the Sinaloa Cartel and the Jalisco New Generation (CJNG), use intermediaries in Mexico’s oil and gas industry to smuggle stolen crude oil from Petróleos Mexicanos (Pemex) into the United States, according to a warning from the U.S. government.
The Stolen Oil’s Destination
This stolen oil is then sold to small U.S.-based oil and gas companies that are importers operating near the southwestern border with Mexico, as per the alert issued by the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of Treasury.
Impact on Mexico and the U.S.
FinCEN details: “Through these schemes, cartels are stealing hundreds of millions of dollars worth of crude oil from Pemex, fueling rampant violence and corruption in Mexico and undermining legitimate oil and gas companies in the U.S.”
Moreover, the alert highlights that fuel theft in Mexico, including crude oil smuggling, has become the primary source of illicit income for cartels not related to drug trafficking, enabling them to sustain their global criminal operations and narcotrafficking towards the U.S.
U.S. Government’s Response
In response to this situation, the U.S. government issued the alert to encourage financial institutions to detect, identify, and report suspicious activities related to fuel smuggling.
This alert was released in early May in coordination with sanctions imposed by the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) on three Mexican individuals and two entities in Mexico linked to the CJNG’s fuel and oil smuggling across the U.S.-Mexico southwestern border.
Key Questions and Answers
- Q: Who are the cartels involved? A: Mexican drug cartels, such as the Sinaloa Cartel and the Jalisco New Generation (CJNG).
- Q: How do they steal the oil? A: By exploiting intermediaries in Mexico’s oil and gas industry.
- Q: Where is the stolen oil sold? A: To small U.S.-based oil and gas companies near the southwestern border.
- Q: What is the impact on Mexico and the U.S.? A: It fuels violence and corruption in Mexico, undermines U.S. oil and gas companies, and supports cartels’ global criminal operations.
- Q: What actions has the U.S. government taken? A: Issued an alert and imposed sanctions on individuals and entities involved in fuel smuggling.
The Cost of Fiscal Fuel Smuggling in Mexico
Fiscal smuggling of gasoline and diesel, also known as “huachicol fiscal,” caused a loss of 177,170 million pesos for the federal government in 2024, equating to 485 million pesos daily.
These figures do not account for the cost to Pemex (and consequently, the Mexican government) from the oil theft committed by organizations like Mexican cartels, as warned by the U.S. government.
Recent Seizure in Tamaulipas
In late March, elements of the Mexican government’s Security Cabinet conducted a historic seizure of 10 million liters of illegal diesel in Tamaulipas.
The smuggled fuel had arrived in Mexico just days before, on March 19, via a ship that docked at the port of Tampico. The vessel reportedly carried additives for vegetable oils.
After conducting the operation, authorities found millions of liters of diesel on a plot in Altamira (approximately 24 km from the Tampico port) and proceeded to seize it.
