Brazilian Gangs Fight For Control Of Black Market For Oil Amidst Economic Decline

A black market for oil in Brazil is believed to be fueling a criminal enterprise that is growing fast in the country’s oil heartland that is situated between Sao Paulo and Rio de Janeiro. This has resulted in killings as rival gangs now struggle for control of the lucrative sector.

Most of the fuel that is stolen by the gangs belongs to Petrobras, the oil firm that is owned and run by the Brazilian government. Some of the methods used to steal fuel from the oil giant include using a system of tubes that are able to siphon the fuel from the pipelines that are buried underground and which come from the refinery.

More and more

The thefts have been increasing in frequency over the years. In 2014 there was just one incident that was reported. A year later in 2015 14 incidents where there was either a theft or an attempted theft were reported. Last year, the number of incidents rose to 73. The rise has been attributed to the economic problems that are bedeviling Brazil as the country grapples with the worst recession on record. Besides the oil thefts, there has also been a surge in other crimes in the most populous country in South America.

Masterminds of the oil thefts are believed to be powerful militias especially those based in Rio de Janeiro. Most of the militia members are police officers who are either retired or off-duty. There has also been a trend by the militia to turn to crimes that have a lower profile since the authorities have been cracking down on violence and terror in recent years.

In the dark

Besides siphoning fuel from underground pipelines, these gangs also hijack tanker trucks which are used to tap from the pipelines. After stealing, the oil is then refined in secret refineries. But even though the thefts have been going on for several years now, Petrobras has no data on how much of the oil it is losing to the criminal enterprises.

“Not even Petrobras knows exactly how much is being stolen,” Giniton Lages, a police chief in Rio de Janeiro said.

In the era of weak oil prices, the thefts have been adding to the challenges that the state oil giant has been facing lately. Petrobras is now engaged in restructuring efforts as is struggles with a debt that currently stands at $100 million. The state oil giant has also been facing allegations of political kickbacks and corruption.

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