Elevated oil prices cause thefts of oil to burgeon

With the recent big increase in the price of oil stemming from the war in Iran has come a spike in the thefts of oil around the Permian Basin.

Just how much is being stolen is as yet mostly undetermined as new Texas state anti-oilfield theft laws kick in, but the Permian Basin Petroleum, Texas Oil and Gas and Texas Independent Producers and Royalty Owners associations say there is no lack of efforts from law enforcement and the energy industry to fight it.

PBPA President Ben Shepperd said oilfield theft has unfortunately been a persistent challenge in the Permian Basin for a number of years and it is something the industry, law enforcement and policymakers have been working together to address.

Ben Shepperd

“The region’s vast geography and the remote nature of many facilities can make it an attractive target for criminal activity, which is why the industry has supported stronger enforcement tools and better coordination with state and local authorities,” Shepperd said.

“Recent legislative efforts in Texas, including the creation of a dedicated petroleum theft prevention unit and a statewide task force on which PBPA serves, are important steps toward improving coordination among law enforcement, regulators and industry to combat these crimes.”

He said these efforts are still relatively new, so it is likely too early to measure their full impact, but they represent a serious commitment to addressing the problem and going after the organized networks responsible.

“We have pursued similar efforts in New Mexico, but there is still a good bit of work to be done,” Shepperd said. “While higher commodity prices can create additional incentives for criminal activity, it is difficult to directly attribute changes in theft incidents to short-term price movements or geopolitical events.

“Oilfield theft tends to be carried out by organized groups targeting infrastructure such as storage tanks, trucks or pipelines and the stolen product is often blended into legitimate supply chains or moved through illicit transport networks, which can make tracking specific volumes challenging.”

Shepperd said what is clear is that oilfield theft is not a victimless crime.

“It affects operators, royalty owners and taxpayers by stealing resources that generate jobs, tax revenue and economic activity across Texas and New Mexico,” he said. “That is why the industry continues to support stronger enforcement, better reporting and close collaboration with law enforcement to deter these crimes and hold those responsible accountable.”