In an open acknowledgement that it cannot secure its pipeline system from plunder by criminal gangs, Mexico's state oil monopoly Pemex announced Feb. 18 that it will no longer pump refined gasoline and diesel through the duct network. Mexico lost $1.14 billion last year to pipeline thefts last year—a 70% increase over the previous year. This is an ominous sign that the drug cartels are becoming the real power on the ground throughout much of the country—moving beyond their mainstays of illicit substances to contraband control of legal commodities like oil and minerals, establishing a virtual parallel economy. Pemex will now only send "unfinished" fuel through its more than 14,000 kilometers of pipeline, reported El Universal. The company said in a statement: "Customers should make sure that the fuel they buy has been delivered from Pemex terminals, and not buy gasoline or diesel from anyone other than gas stations or authorized dealers, given that...it could damage motors."

Cartels like the Zetas have already built a sophisticated distribution network for stolen oil, notes InSight Crime. In the northeastern state of Tamaulipas, the Zetas and Gulf Cartel now control up to 15% of the gasoline business. "This is a big admission of the vulnerability of Pemex," George Baker, publisher of the Houston-based newsletter Mexico Energy Intelligence, told CBC.

Cross-post to High Times and Global Ganja Report.