A Crude Awakening: The Global Black Market for Oil
The value of the crude oil production alone is worth a staggering $1.7 trillion each year. Add downstream fuels and other services to that, and oil is a money-making machine.
Both companies and governments take advantage of this resource wealth. More of the world’s largest companies work in the oil patch than any other industry. At the same, entire government regimes are kept intact thanks to oil revenues.
The only problem when an industry becomes this lucrative?
Eventually, everybody wants a piece of the pie – and they’ll do anything to get their share.
The Black Market in Fuel Theft
Today’s infographic comes from Eurocontrol Technics Group, and it highlights the global problem of fuel theft.
While pipeline theft in places like Nigeria and Mexico are the most famous images associated with the theft of hydrocarbons, the problem is actually far more broad and systematic in nature.
Fuel theft impacts operations at the upstream, midstream, and downstream levels, and it is so entrenched that even politicians, military personnel, and police are complicit in illegal activities. Sometimes, involvement can be traced all the way up to top government officials.
E&Y estimates this to be a $133 billion issue, but it’s also likely that numbers around fuel theft are understated due to deep-rooted corruption and government involvement.
How Fuel Theft Actually Happens
Billions of dollars per year of government and corporate revenues are lost due to the following activities:
Tapping Pipelines: By installing illicit taps, thieves can divert oil or other refined products from pipelines. Mexican drug gangs, for example, can earn $90,000 in just seven minutes from illegal pipeline tapping.
Illegal Bunkering: Oil acquired by thieves is pumped to small barges, which are then sent to sea to deliver the product to tankers. In Nigeria, for example, the Niger Delta’s infamous labyrinth of creeks is the perfect place for bunkering to go undetected.
This involves the transfer of illegal fuel to a more reputable ship, which can be passed off as legitimate imports. For example, refined crude from Libya gets transferred from ship-to-ship in the middle of the Mediterranean, to be illegally imported into the EU.
Armed Theft (Piracy):
This involves using the threat of violence to command a truck or ship and steal its cargo. Even though Hollywood has made Somalia famous for its pirates, it is the Gulf of Guinea near Nigeria that ships need to be worried about. In the last few years, there have been hundreds of attacks.
Bribing Corrupt Officials:
In some countries – as long as the right person gets a cut of profits, authorities will turn a blind eye to hydrocarbon theft. In fact, E&Y says an astonishing 57.1% of all fraud in the oil an gas sector relates to corruption schemes.
Smuggling and Laundering:
Smuggling oil products into another jurisdiction can help to enable a profitable and less traceable sale. ISIS is famous for this – they can’t sell oil to international markets directly, so they smuggle oil to Turkey, where it sells it at a discount.
Adulteration is a sneaky process in which unwanted additives are put in oil or refined products, but sold at full price. In Tanzania, for example, adding cheap kerosene and lubricants to gasoline or diesel is an easy way to increase profit margins, while remaining undetected.
The Implications of Fuel Theft
The impact of fuel theft on people and the economy is significant and wide-ranging:
Loss of corporate profits: Companies in oil and gas can lose billions of dollars from fuel theft. Case in point: Mexico’s national oil company (Pemex) is estimated to lose $1.3 billion per year as a result of illegal pipeline tapping by gangs.
Loss of government revenues: Governments receive royalties from oil production, as well as tax money from finished products like gasoline. In Ireland, the government claims it loses €150 to €250 million in revenues per year from fuel adulteration. Meanwhile, one World Bank official pegged the Nigerian government’s total losses from oil revenues stolen (or misspent) at $400 billion since 1960.
Funds terrorism: ISIS and other terrorist groups have used hydrocarbon theft and sales as a means to sustain operations. At one point, ISIS was making $50 million per month from selling oil.
Funds cartels and organized crime: The Zetas cartel in Mexico controls nearly 40% of the fuel theft market, raking in millions each year.
Environmental damage: Not only does fuel theft cost corporations and governments severely, but there is also an environmental impact to be considered. Fuel spills, blown pipelines, and engine damage (from adulterated fuel) are all huge issues.
Leads to higher gas prices: Unfortunately, all of the above losses eventually translate into higher prices for end-customers.
How to Stop Fuel Theft?
There are two methods that authorities have been using to slow down and eventually eliminate fuel theft.
Fuel dyes are used to color petroleum products a specific tint, so as to allow for easy identification and prevent fraud. However, some dyes can be replicated by criminals – such as those in Ireland who “launder” the fuel.
Molecular markers, which are used in tiny concentrations of just a few parts per million, are invisible and can also be used to identify fuels.
In Tanzania, the initiation of a fuel marking program using molecular markers led to significant increases of imported petrol and diesel for the local market, and a decrease of kerosene.
At the retail level, product meeting quality standards increased from 19% in 2007 to 91% in 2013. Ultimately, this resulted in an increase of tax revenue of $300 million between 2010 and 2014.
The Top 10 Biggest Companies in Brazil
What drives some of the world’s emerging economies? From natural resources to giant banks, here are the top 10 biggest companies in Brazil.
The Top 10 Biggest Companies in Brazil
In 2009, the at-the-time emerging economies of Brazil, Russia, India, and China held their first formal summits as members of BRIC (with South Africa joining in 2010).
Together, BRICS represents 26.7% of the world’s land surface and 41.5% of its population. By GDP ranking, they’re also some of the most powerful economies in the world.
But what drives their economies? We’re highlighting the top 10 biggest companies in each country, starting with Brazil.
What Are the Biggest Public Companies in Brazil?
Brazil isn’t just one of the largest and most diverse countries in the world, it is also an economic powerhouse.
With over 213 million people, Brazil is the sixth most populous country on Earth and the largest in Latin America. It’s also the wealthiest on the continent, with the world’s 12th-largest economy.
Once a colony focused on sugar and gold, Brazil rapidly industrialized in the 20th century. Today, it is a top 10 exporter of industrial steel, with the country’s economic strength coming chiefly from natural resources and financials.
Here are Brazil’s biggest public companies by market capitalization in October 2021:
|Top 10 Companies (October 2021)||Category||Market Cap (USD)|
|Vale||Metals and Mining||$73.03B|
|Petróleo Brasileiro||Oil and Gas||$69.84B|
|Banco Santander Brasil||Financial||$24.70B|
|Rede D’Or Sao Luiz||Hospital||$23.79B|
At the top of the ranking is Vale, a metals and mining giant that is the world’s largest producer of iron ore and nickel. Also the operator of infrastructure including hydroelectricity plants, railroads, and ports, It consistently ranks as the most valuable company in Latin America.
Vale and second-ranking company Petróleo Brasileiro, Brazil’s largest oil producer, were former state-owned corporations that became privatized in the 1990s.
Finance in Brazil’s Top 10 Biggest Companies
Other than former monopolies, the top 10 biggest companies in Brazil highlight the power of the banking sector.
Five of the 10 companies with a market cap above $20 billion are in the financial industry.
They include Itaú Unibanco, the largest bank in the Southern Hemisphere, and Banco Santander Brasil, the Brazilian subsidiary of Spanish finance corp.
Another well-known subsidiary is brewing company Ambev, which produces the majority of the country’s liquors and also bottles and distributes PepsiCo products in much of Latin America. Ambev is an important piece of Belgian drink juggernaut Anheuser-Busch InBev, which is one of the world’s largest 100 companies.
Noticeably missing from the top 10 list are companies in the agriculture sector, as Brazil is the world’s largest exporter of coffee, soybeans, beef, and ethanol. Many multinational corporations have Brazilian subsidiaries or partners for supply chain access, which has recently put a spotlight on Amazon deforestation.
What other companies or industries do you associate with Brazil?
Correction: Two companies listed had errors in their market cap calculations and have been updated. All data is as of October 11, 2021.
Which Countries Have the Most Nuclear Weapons?
How big is the world’s nuclear arsenal? Here are the stockpiles of the nine countries with nuclear weapons.
Which Countries Have the Most Nuclear Weapons?
In theory, nuclear weapon stockpiles are closely held national secrets. The leading countries have rough estimates that aren’t regularly updated, newly nuclear countries keep their capabilities vague and unclear, and Israel has never officially confirmed a nuclear weapons program.
But thanks to limited disclosures, records, and leaks, we can visualize the full extent* of the world’s nuclear arsenal. This graphic uses estimated nuclear warhead inventories from the Federation of American Scientists as of August 2021.
Based on these estimates, there are just nine countries with nuclear weapons in the world.
Editor’s note: Exact numbers of nuclear warheads possessed by countries are closely guarded state secrets, with the FAS estimate being the closest, most-used, and most-trusted international approximation available.
Nuclear Weapons, by Country
The nuclear arms race has always centered around the U.S. and Russia.
After the end of World War II and well into the Cold War, the world’s two superpowers raced to build more nuclear weapons (and more capable nuclear weapons) than the other.
Even while international organizations lobbied for the end of nuclear proliferation, the world’s nuclear weapon stockpile grew to a peak of 70,300 total warheads in 1986.
As arms agreements and non-proliferation treaties started to gain greater momentum, the U.S. and Russia cut back on stockpiles while new countries with nuclear weapons started to pop up.
|Country||Total Warheads (2021)||% of Total|
|🇰🇵 North Korea||45||0.34%|
Despite reducing their stockpiles significantly since the end of the Cold War, Russia and the U.S. still own around 90% of all nuclear warheads in the world.
Far behind them are China and France, which started testing nuclear weapons in 1964 and 1960 respectively. The UK has the fifth-most nuclear weapons today, though it was the third country in the world to develop them after the U.S. and Russia in 1952.
The countries with fewer than 200 nuclear weapons are regional rivals India and Pakistan, which first tested nuclear weapons in the 1970s, and North Korea, which began to operate uranium fabrication plants and conduct explosive tests in the 1980s.
Israel is also estimated to have fewer than 200 nuclear weapons, and reports have its weapons program dating back to the 1960s. However, the country has never confirmed or announced its nuclear capabilities.
Countries With Nuclear Weapons, by Warhead Status
Though the world has 13,132 nuclear weapons, that doesn’t mean they’re all ready to fire.
Weapons (or “warheads”) are delivered by missile, and countries don’t keep all of their nuclear warheads primed for use. The estimation of nuclear stockpiles also clarifies whether warheads are considered deployed, reserved, or retired:
- Deployed warheads are deployed on intercontinental missiles, at heavy bomber bases, and on bases with operational short-range delivery systems.
- Reserve warheads are in storage and not deployed on launchers.
- Retired warheads are still intact but in queue for dismantlement.
|Country||Deployed Warheads||Reserve Warheads||Retired Warheads|
|🇰🇵 North Korea||0||45||0|
Only four countries have officially deployed warheads, while the majority of the world’s nuclear stockpile is in reserve. This is partially due to estimates ranging from relatively transparent in the case of the U.S. to opaque and uncertain for countries like China and North Korea.
But some countries are expected to further bolster their stockpiles. The UK government announced it would increase its stockpile to no more than 260 warheads, and U.S. intelligence expects China, India, and Pakistan to increase their stockpiles.
Though the world’s nuclear stockpile will likely continue dwindling on account of U.S. and Russia retirements, the 2021 landscape of countries with nuclear weapons shows that proliferation is still underway.
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