The US-Mexico Oil Theft Racket
Cartels still make billions robbing Mexican petroleum, with US help
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By Juan Alberto Cedillo and Ioan Grillo
When you fill up your car in the state of Tamaulipas, Mexico, south of the Rio Grande Valley in Texas, you think you are buying premium refined gasoline. But according to multiple sources in the industry in Tamaulipas, various companies have been under duress from a cartel to sell a mix of fully-refined gas along with semi-refined gas that was stolen from Mexico’s state oil company, Pemex.
The scam is part of a U.S.-Mexico petroleum theft ring that involves cartels, corrupt Mexican officials and criminal U.S. brokers. In the scheme, vast amounts of oil is stolen from Mexican installations and pipelines and smuggled into Texas, where it is laundered into the industry and ends up as far away as Japan; some oil is also smuggled back semi-refined into Mexico.
The crime robs valuable resources from Mexican state coffers and finances paramilitary organized crime groups, now classified by Washington as terrorists. It also causes fatal explosions in Mexico and serves motorists bad fuel that can damage their vehicles.
U.S. law enforcement has launched a new crackdown on the racket, encouraged by a campaign against cartels pushed by the Trump White House. On April 17, a court in Texas indicted four members of the Jensen family of Utah on smuggling and money laundering charges linked to thousands of shipments and demanded $300 million worth of asset seizures. Days later, U.S. marshals arrested James Lael and Kelly Anne Jensen in their $9-million mansion in Sandy, Utah. On May 1, the Department of the Treasury’s Office of Foreign Assets Control sanctioned three Mexican citizens and two Mexican companies accused of being involved in the fuel ring as well as with drug trafficking.
CrashOut traveled through Tamaulipas from the port of Tampico to the border city of Matamoros to interview various executives in the fuel industry about the issue. They were all genuinely fearful of repercussions from the cartel and asked for anonymity; in July, gunmen assassinated business leader Julio Almanza Armas, head of the Tamaulipas federation of chambers of commerce, days after he had denounced the cartel. We also combed through U.S. filings on the case, including the indictment of the Jensen family.
Looking at the scale of oil theft in Mexico, and how the government loses billions of dollars in resources, it’s mind-boggling how it carries on so blatantly in an industrialized country. Former Mexican president Andrés Manuel López Obrador is from the petroleum-rich state of Tabasco, and he preached an “oil nationalism,” and launched a crackdown on fuel thieves, known as “huachicoleros.” But while he had some initial successes, the racket has bounced back and is yet another problem that the current President Claudia Sheinbaum has to face.
The Gulf-Jalisco Cartel Alliance
The U.S. Treasury sanctioned cartel leader Cesar Morfín, alias “El Primito,” accusing him of running the fuel racket as well as moving meth, fentanyl, cocaine and heroin. A collector of exotic animals, including this jaguar seized by Mexican security forces, Primito rose up in the ranks…
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