Tuesday, June 29, 2010

The State vs. The Narco State.

The Mexican government exists on the revenue it derives from Pemex, the national oil company. Here's an update from Stratfor on the ongoing criminal assault on Pemex:

While oil and gasoline theft and smuggling are hardly a new occurrence in Mexico, having areas of Pemex property where officials and workers simply cannot go due to the threat posed by criminal organizations represents a definite escalation in criminal pressure on the company. And with Pemex being the lifeblood of Mexico’s budget, accounting for between 30-40 percent of federal revenue for the budget, the development is ominous indeed for Mexico City. While it is unclear whether the criminal interference has had any meaningful impact on federal revenues (though some estimates have indicated that Pemex loses upward of $100 million annually from organized crime interference — which evidently has not warranted a federal response), any sustained, meaningful interference by any criminal organization will likely merit a strong reaction from the federal government, which is perhaps why the Pemex officials issued these statements.