Mexico president says plan to counter fuel theft saves 12 billion pesos

FILE PHOTO: Mexico's President Andres Manuel Lopez Obrador looks on during a news conference at the National Palace in Mexico City, Mexico April 15, 2019. REUTERS/Edgard Garrido

MEXICO CITY (Reuters) - Mexican President Andres Manuel Lopez Obrador said on Tuesday that a government drive to stamp out fuel theft launched days after his administration took office had generated savings of 12 billion pesos ($635 million).

Lopez Obrador closed six major pipelines where thieves and criminal gangs were siphoning off fuel worth billions of dollars as part of a plan launched in late December to tackle intensifying theft from state oil company Pemex. Instead, the fuel from the closed pipelines is delivered by tanker trucks.

“We have so far saved 12 billion pesos, at the Pemex price, not the price of gas stations,” Lopez Obrador told his regular daily press conference.

Early on, the crackdown led to gasoline shortages and consumers lining up at gas stations for hours.

Lopez Obrador said at its current rate, the plan could generate additional savings of about 50 billion pesos ($2.64 billion), without giving further details.

The veteran leftist took office on Dec. 1 after winning a landslide election victory on promises to root out endemic corruption, strengthen Pemex and ensure stable fuel prices.

In the same press briefing, Pemex Chief Executive Octavio Romero said that fuel theft had fallen to an average of 11,500 barrels per day (bpd) in the first quarter of the year, from more than 74,000 bpd in early December.

Romero said there has been a “slight rebound and stabilization” in production of crude oil to 1.685 million bpd so far in April.

In January, production averaged 1.626 million bpd, compared to an average of 1.928 million bpd in the same month last year, according to Romero.

Reporting by Sharay Angulo and Delphine Schrank; Editing by Alistair Bell