On 26 December 2016, the Mexican government announced that gasoline prices would rise by up to 20% in January as result of the transition towards eliminating price controls. Beginning with the Mexican oil expropriation in 1938, the government controlled the country's entire petroleum industry—including both production and retail sales. The state-owned companyPemex held a monopoly on all gasoline sales in the country, and prices were set by the government. In 2013, newly elected president Enrique Peña Nieto began the process of privatizing Mexico's oil industry, which would eventually allow private companies to establish their own gas stations. The Mexican government planned to transition to market prices gradually throughout 2017. Finance MinisterJosé Antonio Meade explained that the price hike was "an important change" which would "allow prices to reflect costs, and avoid artificial distortions." The rise in gasoline prices was also a result of the government ending subsidies to the oil industry, and may have been motivated by projected budget deficits due to the peso's weakening value compared to the United States dollar. The price hike—scheduled to begin on 1 January 2017—coincided with an economy marked by high inflation in addition to the weak peso. Donald Trump's recent election as president of the United States led to uncertainty as the candidate had campaigned on strong economic protectionism. Furthermore, president Peña Nieto was experiencing historically low approval ratings and was involved in numerous scandals. Tensions in Mexico were also raised by the high homicide rates associated with the continued Mexican Drug War, which began over ten years earlier.
Protests
Protests began on 1 January, the same day the new prices took effect. Activists used social media to organize protests and shut down gas stations throughout the country. Protestors also blockaded major highways and border crossings. Their demands included cheaper gasoline prices as well as the resignation of president Peña Nieto. Protests and riots took place all over the country. Demonstrations in Tijuana and Nogales forced authorities to temporarily close Mexico–United States border crossings. In Rosarito, a man intentionally drove his vehicle into federal police officers. Looting was reported in Veracruz. In Tabasco, a convenience store was ransacked and burned. Mexico City had two large demonstrations in early January, with thousands of protestors in attendance. Over 250 stores were looted during the protests. At least one police officer was killed while trying to prevent looting. At least four deaths have been attributed to the protests, as well as 1,500 arrests.
