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Mexico

Mexico's Pemex Says Protests Cause 'Critical' Border City Fuel Shortage

Protests since the Jan. 1 double-digit fuel price spike have exposed anger with President Enrique Peña Nieto over rising living costs fanned by a slump in the peso

Pemex petrol station pumps are closed due to fuel shortage, caused by the blockade of a storage site by demonstrators protesting a gasoline price hike, at the border city of Mexicali, Mexico, January 10, 2017, photo: Reuters
By Reuters Whatsapp Twitter Facebook Share
3 months ago

Mexico’s oil company, Petróleos Mexicanos (Pemex), is struggling to supply gas stations around the northern border city of Mexicali because of a blockade at a storage site, part of sometimes violent protests and looting over a gasoline price hike.

In a post on Twitter on Tuesday afternoon, Pemex said its ability to supply gas stations in Mexicali, across the border from California, had reached “critical levels” because of the blockade of its local storage plant.

“No gas stations have any inventory,” said Rodrigo Llantada, president of the Employers Federation of Mexico (Coparmex). He said the blockade began last Wednesday.

Protests since the Jan. 1 double-digit fuel price spike have exposed anger with President Enrique Peña Nieto over rising living costs fanned by a slump in the peso currency after Republican Donald Trump’s U.S. presidential victory.

Peña Nieto said last week that the price increase was a “responsible” measure taken by the government in line with international oil prices. Government-set fuel prices in Mexico rose between 14 percent and 20 percent ahead of a gradual, year-long price liberalization the Peña Nieto administration promised to implement this year.

Protesters have looted dozens of gas stations and supermarkets across Mexico. Nearly 2,000 people have been arrested for suspected involvement in related property damage and violence.

Coparmex’s national head on Tuesday asked the federal government to put additional gas price hikes on hold, saying that it should instead make meaningful budget cuts.

Gustavo de Hoyos also criticized an agreement Peña Nieto signed with some business leaders on Monday to tame inflation, saying the government was blaming business for its own errors.

On Saturday, a truck drove into a line of federal police, injuring five, during clashes at another blockaded storage terminal in Baja California, while local media reported that shots were fired during protests on Sunday in the city of Nogales, across the border from Arizona.

The government has defended the price increase as necessary to end subsidies on fuels through a gradual, year-long price liberalization that will free up resources for social spending.

Mexicali, a one-time agricultural outpost built up by Chinese immigrants a century ago, is now a sprawl of industrial plants, stretching into the surrounding desert, that supply the U.S. market.

Multinationals in the Baja California city manufacture everything from Coca-Cola drinks to Apple smartphone chips and sections of Boeing’s latest jet airliners.

“The assembly plant industry is at risk, and the operations of the whole productive sector,” Llantada said.

Residents took to social media to pass on information about where to find fuel, with some braving long lines to cross the border to Calexico, California, to fill up their vehicles.

Leticia Tellaeche, 62, said she was angry with the government for raising prices and with the protesters for making the situation worse.

“They should let the gasoline through, don’t be fools. We know that whatever they do the prices are not coming down,” said Tellaeche, adding that she had taken to using a bicycle.

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