Dirt Cheap Gasoline Is Fueling Colombia’s Cocaine Cartels

Every day, $3 million worth of fuel is smuggled into Colombia from various neighbors who can’t seem to keep their borders under control. Even worse, this is the gas that fuels the mighty cocaine industry.  Although only a handful of ingredients—aside from the coca plant—are used in the manufacture of cocaine, fuel is critical, whether it’s diesel, kerosene, jet fuel or just plain gasoline.  This demand for cross-border fuel is causing headaches for Latin American countries–particularly Ecuador, which is taking a big hit from the illicit exporting of its dirt-cheap, heavily subsidized gasoline to ‘Cocaine Central’ Colombia, where it is used to make the drug. WHAT’S NEXT FOR OIL?

TECHNICAL ANALYSIS

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  • Observe critical resistance points
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  • Seasonal demand for oil might push oil price higher and the CAD short term strength

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