MEXICO CITY— Mexicans are getting an early start to the New Year by taking to the streets and social media to protest a double-digit gas price hike known as el gasolinazo. Hundreds of demonstrators are blocking highways, raiding gas stations, and looting stores as pump prices surge by 15-20% across the country.
The unrest has caused some gas stations to close altogether. Antonio Caballero, who heads a network of 800 gas stations, said at a press conference this week he will temporarily close any filling station threatened by violent protesters.
But it's not just gas stations that are being targeted. Some protesters have used the gasolinazo as an excuse to loot supermarkets and other stores in several states.
Adding to some of the chaos on the streets is a wave of fake news and threats on social media perpetuating rumors about a curfew on Wednesday, pushing some businesses to temporarily close two days before Mexico’s Día de Reyes, a religious holiday that normally has parents flocking to stores to buy toys for their kids.
Mexicans' collective anger over the situation is being directed mostly at President Enrique Peña Nieto, who in 2015 had promised that country’s frequent pump price hikes would end with his much-touted finance and energy reform plans.
But the global collapse of oil prices hindered the long-awaited opening of the country’s energy sector, and the promised relief at the pump and utility bills has yet to materialize.
Peña Nieto called the gas price hike “painful” yet “inevitable” during a press conference on Wednesday.
There are many factors contributing to the so-called gasolinazo, including corruption and mismanagement of Mexico’s state-owned oil company PEMEX. But the main culprit is the gradual liberalization of Mexico's energy industry, which has led to a reduction of government subsidies but without real market competition yet.
Meanwhile Finance Minister Jose Antonio Meade argues that eliminating the subsidies is a cost-saving measure, since they would have cost taxpayers approximately $10 billion anyway. He blamed the pump price hike on a rise in international oil prices, since the country imports more than half of its gasoline due to a lack of modern refinery infrastructure.
Other Cabinet members are urging Mexicans to look on the bright side. Mexico’s minister for environment tweeted ending gas subsidies can help combat climate change.
Although violent protests have dominated the headlines in recent days, there have been many peaceful demonstrations as well—including on social media, which has produced a flurry of very funny memes:
But the laughs might not last for long. Some analysts warn the gasolinazo could further impact Mexico's inflation as the peso continues to fall against the dollar.
It's an inauspicious start to a New Year when the country is already bracing for Donald Trump’s retaliatory economic policies.