Mexico's ex-oil boss quits; Fuel oil burn to increase

The former leader of Mexico's oil workers' union will finally be resigning from his symbolic post as a worker at the state-owned oil company Pemex

Mexico Energy (AP2002)

The former leader of Mexico’s oil workers’ union will finally be resigning from his symbolic post as a worker at the state-owned oil company Pemex President Andrés Manuel López Obrador announced Tuesday.

The resignation marks an end to the decades-long career of Carlos Romero Deschamps, once considered one of the most powerful and corrupt figures in Mexico

In October 2019, Romero Deschamps resigned as leader of the union, a post he held since 1993.

López Obrador said Romero Deschamps had not actually been working since he resigned the union post, but rather using up vacation days he accumulated while serving as a union official.

“Even though it may be legal, we considered it was immoral” for Romero Deschamps to continue drawing pay at the beleaguered government oil company, which has been technically bankrupt for some time.

In addition to his union role, Romero Deschamps, 77, long served in Congress for the old ruling Institutional Revolutionary Party, and allegedly diverted millions in union and company funds to the party's campaigns in 2000. His family's lavish lifestyle was a frequent cause of scandal.

This week, the beleaguered oil company has reportedly reached a deal with the state-owned electrical power utility to offload stocks of fuel oil that Pemex can't get rid of. The utility will take the heavily polluting fuel oil to burn at power plants, and return natural gas that Pemex cannot produce enough of.

The deal would worsen pollution problems at state-owned generating plants. But López Obrador has enacted a new law that electricity must first be bought from government-owned generating plants, which largely run on fossil fuels like coal, fuel oil and diesel. If any demand remains, power will be purchased from renewable and private natural gas-fired plants.

That has drawn complaints from investors, many of them foreign, who say it violates the U.S.-Mexico-Canada free trade pact and Mexico’s commitments to cut carbon emissions. They claim it also creates a de facto government monopoly, hurts competition and will make Mexicans buy dirtier, more expensive electricity.

López Obrador has said the law is meant protect government-owned fossil fuel plants against what he call unfair competition from private wind, solar and natural gas-fired power plants.