Fuel Smuggling in Mexico: Marketers and Distributors at the Heart of ‘Huachicol’
Mexico’s ongoing battle against fuel theft – known as “huachicol” – has uncovered a critical, yet largely unseen, network of actors facilitating the illegal trade: fuel marketers and distributors. Investigations by the Federal Security Cabinet reveal these entities are instrumental in moving stolen fuel to consumers, representing a significant challenge to state-owned oil company Pemex and national energy security.
The Rise of Private Sector Involvement
The surge in fuel smuggling coincided with the 2013 energy reform, which opened Mexico’s hydrocarbon sector to private participation. This sparked interest from thousands of companies seeking to enter the fuel marketing business. According to official figures, between May 8, 2015, and June 20, 2024, the now-defunct Energy Regulatory Commission (CRE) received 983 applications for hydrocarbon marketing permits. However, only 40% of applicants gained access to the market, with 586 permits currently active, 131 expired, six terminated, one deemed invalid, and 259 still under review.
Tracing the Flow of Stolen Fuel
Experts emphasize the urgent need for the Attorney General of the Republic to prioritize tracing the origin and distribution of “huachicol.” This investigation must extend beyond importing companies to encompass marketers, distributors, and carriers. A recent, significant blow to fuel theft occurred on July 7th, when federal authorities confiscated 15 million liters of stolen fuel transported in 129 tankers owned by Ingemar import company, SA de CV. This seizure has intensified scrutiny on fuel marketing companies, which play a pivotal role in the energy supply chain.
Responsibility Lies with the National Energy Commission
“The growing responsibility for ‘huachicoleo’ in the country falls on the National Energy Commission, which is responsible for issuing marketing and distribution permits,” stated an analyst and advisor to the energy industry, Ramsés Pech, to El Universal. “The Commission must review existing contracts and permits, particularly the eight distributor permits issued between 2018 and 2024, and the numerous permits granted to marketers. A thorough review is needed to ensure these permits are being used appropriately.”
Fuel marketers are authorized to sell, distribute, and supply liquid fuels and hydrocarbon derivatives to final consumers or distributors, ensuring fuel flows from refineries and processing plants to points of sale.
Ingemar and Crismón: A Case Study
Recent scrutiny has focused on the relationship between Ingemar, an import company, and its designated marketer, Crismón Hydrocarbons and Derivatives, SA de CV. Ernesto Ruffo Appel, a partner at Ingemar, asserted in an interview with El Gran Diario de México that marketers are central to the fuel movement. “The marketers do the whole trajín, the fuel movement. The importer only handles the customs paperwork; we are the importer, that’s all. In fact, we don’t see the fuel, we only see papers,” he insisted.
Ruffo Appel clarified that Crismón was directly designated by the Federal Government, not chosen by Ingemar. “Crismón is our marketer, our only client, and was authorized by the Energy Regulatory Commission. We only have an import permit, and a marketer is required to obtain permission. The Energy Regulatory Commission approved and appointed this marketer; we did not manage it.”
Crismón Hydrocarbons and Derivatives, SA de CV, was officially established on August 2, 2018, in Matamoros, Tamaulipas, with Luis Miguel Fuentes García and Roy Ángel Pérez García as its primary partners. The company’s stated corporate purpose encompasses the entire hydrocarbon supply chain, from purchase and import to distribution and sale, including the operation of service stations. Crismón obtained permit H/23369/com/2020 for oil commercialization on March 27, 2020, alongside 12 other companies during a virtual session of the Energy Regulatory Commission held amidst the COVID-19 pandemic.
The Need for Increased Oversight
The permit granted by the CRE mandates that permit holders “verify the lawful origin of the products authorized by submitting information or documentation, when the Commission so requires, in terms of the applicable legal provisions.” However, energy consultant Luis Miguel Labardini argues that authorities must investigate potential corruption between marketers and federal officials.
“Without a doubt, the marketers bear responsibility in the commission of this crime,” Labardini noted. “However, there are two problems related to the Mexican State: either customs is not doing its job, or customs officials are involved in corruption. The State is failing to inspect cargo and ensure its legitimacy. Furthermore, the Energy Regulatory Commission – now the National Energy Commission – has a responsibility to supervise permit compliance.”
The fight against “huachicol” requires a comprehensive approach, targeting not only theft at the source but also the intricate network of marketers and distributors that enable the illicit trade to reach consumers.
