A series of recent seizures and arrests underscore how powerful criminal groups in Mexico are expanding their involvement in fuel theft, one of the country’s fastest-growing and most profitable criminal economies whose pull is also corrupting the state’s most trusted security branches.
Mexican security forces detained 14 people, including a high-level navy officer, on September 6 following the discovery of 10 million liters of illicit diesel in March, one of the largest seizures in the country’s history. Criminal groups smuggled the fuel from the United States on a 46,000-ton tanker avoiding Mexican fuel taxes, according to the authorities. The cross-border network was enabled by a network of complicit companies and corrupt customs officials and law enforcement officers
These new arrests are just the latest example of how in recent years, criminal groups have transformed their participation in illicit fuel markets on both sides of the US-Mexico border. The country’s fuel theft mafias, some designated by the US government as “terrorist organizations,” have expanded to tap international energy markets at scale, with oil stolen in Mexico reaching the United States, India, and even as far as Japan, according to recent US intelligence.
SEE ALSO: CJNG’s Fuel Theft Empire in the Crosshairs of US Treasury Sanctions
Conversely, billions of liters of illicit fuel have also flowed from the United States into Mexico, where criminal networks have used shell companies and customs fraud to evade the country’s fuel taxes. The hydrocarbons are then sold on the country’s burgeoning black markets, generating tens of millions of dollars in profits for organized crime.
*This is the first of a special three-part series detailing the changing dynamics of Mexico’s multibillion-dollar fuel theft industry.
Fuel theft is the “most significant non-drug illicit revenue” for Mexico’s criminal mafias, according to the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in May. US authorities alleged that several Texas-based energy companies were “complicit” in illegal cross-border flows of hydrocarbons, and had purchased fuel stolen by organized crime groups.
From Robin Hood to the CJNG
On January 18, 2019, fuel thieves in a field near the small town of Tlahuelilpan drilled into the Tuxpan-Poza Rica-Tula pipeline, propelling a jet of fuel into the sky. The thieves fled, leaving fuel cascading down onto a field. As night fell, local families started to arrive at the pipeline to try and fill small plastic buckets and bottles with a few dollars of free fuel gushing from the earth.
Then, an errant spark of static electricity set the whole scene alight, detonating an explosion that killed at least 137 people.
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Criminal groups have used huachicol as a source of criminal revenues since the 1990s. The first groups drilled into the oil pipelines that crisscross Mexico and used taps, hoses and jerry cans to extract fuel, a modus operandi that remains in use today at a much larger scale.
Early fuel thieves were mostly small local organizations that cultivated a Robin Hood-esque image by hawking cheap, stolen fuel to their communities. Tapping pipelines with rudimentary equipment was dangerous work, and the exploits of these groups were often celebrated in tuneful ballads. Some thieves even prayed to El Niño Huachicoleo, the folk saint of oil theft, to avoid arrest, protect their families, and prevent pipeline fires.
But by 2007, large criminal groups, led by an armed wing of the Gulf Cartel known as the Zetas, started to muscle into Mexico’s huachicol markets in the northern state of Tamaulipas, disrupting local thieves. That year, US intelligence shared with the Mexican government revealed that the Zetas were involved in a sprawling fuel theft and smuggling operation based in an oil-rich stretch of Tamaulipas known as the Burgos Basin.
A few factors coalesced to make huachicol a focus for Mexico’s large criminal mafias. First, a sustained government crackdown, starting in 2006, against drug trafficking nudged organized crime groups to explore alternative revenue streams. At the same time, the Mexican government started to wind down fossil fuel subsidies, causing pump prices to tick upwards. This increased the potential profits to be made from selling stolen fuel.
By 2010, both the Gulf Cartel and the Zetas doubled down on fuel theft operations, in part to fund an increasingly bloody war against each other after the Zetas broke off on their own. The scramble for resources made Tamaulipas the country’s first major fuel theft hotspot.
After the arrival of these groups, the number of illegal pipeline taps detected by Mexico’s state-run oil company Petróleos Mexicanos (Pemex) started to surge. The company, which first flagged the existence of pipeline theft to investors after the discovery of 152 taps in 2003, saw the number of taps increase to 710 in 2010 and then to a record-breaking 14,910 in 2018.
As the number of taps grew, so did the geographic spread of oil theft in Mexico.
Mexico’s Fuel Theft Problem Grows
Oil theft started to erupt in new places, driven in part by a security crackdown in Tamaulipas, and the entrance of new criminal players that started tapping pipelines to generate the revenue necessary to compete with the Zetas, and to fend off the group’s relentless appetite for territorial expansion.
From Tamaulipas, fuel theft spread into the central states of Puebla and Guanajuato. The Jalisco Cartel New Generation (Cartel Jalisco Nueva Generación – CJNG), which was already one of Mexico’s most powerful crime groups by 2015, had strongholds in both states, and followed the Zetas into the trade, starting a violent takeover of territory close to pipeline infrastructure in central Mexico from 2015.
Some local groups banded together to resist the incursion by CJNG. One of these collectives became the Santa Rosa de Lima Cartel, a group specialized in fuel theft that fought back fiercely against the CJNG in Guanajuato. Fighting between these groups erupted in 2017 and was partly responsible for the rapid deterioration of security in the state, transforming it from one of Mexico’s more peaceful states into one of the most homicidal.
“You have to control where the pipelines are in order to do the thieving … So [criminal groups] fight over physical territory in a way that they don’t fight over territory to traffic synthetic drugs like fentanyl or methamphetamine,” Jane Esberg, a researcher who studied fuel theft in Mexico, told InSight Crime.
Today, Hidalgo, another CJNG stronghold, is the country’s fuel theft capital. The state is home to the Tula refinery, one of Mexico’s largest, which is equipped to process about 315,000 barrels of crude oil a day. In 2024 alone, the state recorded 2,450 illegal pipeline taps, the most in the country.
SEE ALSO: Violence Rising in Hidalgo, Mexico’s Oil Theft Center
Critical infrastructure has also drawn thieves to the state. “The center of the country has great highways … You have access to the entire central region of Mexico. That creates a lot of options to distribute stolen fuel,” according to Samuel León Sáez, who wrote a book on fuel trafficking in Mexico.
In the shadow of the Tula refinery stands Tlahuelilpan, the site of the 2019 pipeline explosion. In the field where fuel once rained down now stands a makeshift cemetery in memory of the victims of the disaster. But the town continues to attract fuel thieves.
The pipeline that passes through the town is one of the most tapped in Mexico. Between 2022 and 2023, Pemex detected an average of 3,226 clandestine taps along the pipe each year. Of those, 111 taps were in Tlahuelilpan.
Since the explosion, Mexico’s huachicol groups have only scaled up their plunder. Thieves stole 987 million liters of fuel in 2024, according to the company’s rough estimates, up from 371 million liters in 2019.
And even as this kind of local theft rises, the quantities of fuel stolen from the country’s leaky infrastructure are being dwarfed by a new source of illicit supply: criminal mafias now tap international energy markets to drive their illicit profits beyond what they can steal from Pemex.
Our next article on fuel theft in Mexico dives into the new international business models used by the country’s criminal groups, including how fuel from the United States is increasingly flooding Mexico’s illicit fuel markets, generating hundreds of millions of dollars of profits for organized crime.
Featured image: A Mexican naval officer watches an oil tanker in the Port of Tampico, Tamaulipas. Credit: Mexican Navy