Gas prices reveal Mexico's core problems

Since January 1, the great gas price war has rocked Mexico. The turmoil involves the four core problems Mexico confronts in the 21st century: economic adjustment, systemic political change, crime and national distrust.

The ostensible match that lit this conflagration was the Mexican government's December 27 announcement that gasoline and diesel prices would increase from 14 percent to 20 percent during 2017. Economic adjustment -- check, and one long overdue.

Demonstrations have occurred in 28 of Mexico's 32 states. Numerous gasoline stations have gone up in flames. So far, six people have died in protest-related violence. Some 1,500 have been arrested for various crimes, to include rioting and looting.

A Mexican retail group reported that 350 businesses in 10 states had been "sacked" by thieves. Several thousand other businesses have closed, fearing assault by protestors.

Mexico's energy market is largely government-owned as well as government regulated. The state oil company, Petroleos Mexicanos (Pemex), has nationalist political roots. Formed in 1938 in the midst of an oil worker strike, the government used expropriated foreign oil company assets to create Pemex. Many of the companies that lost assets were American.