Mexican oil expropriation
This article relies largely or entirely on a single
The Mexican oil expropriation (
The anniversary, March 18, is now a Mexican
On August 16, 1935, the Petroleum Workers Union of Mexico (Sindicato de Trabajadores Petroleros de la República Mexicana) was formed and one of the first actions was the writing of a lengthy draft contract transmitted to the petroleum companies demanding a 40-hour working week, a full salary paid in the event of sickness, and the payment of 65 million pesos towards benefits and wages. The foreign oil companies refused to sign the agreement, and counter offered with a payment of 14 million pesos toward wages and benefits.
On November 3, 1937, the union demanded that the companies sign the collective agreement and on May 17, the union summoned a strike in case their demands were not met. On May 28 the strike became effective throughout the country.
The petroleum workers' struggle was well regarded by the President and the population despite problems caused by the petroleum shortage. Due to these problems, the union accepted a lift of the strike on June 9, after the president urged them to present their case before the General Arbitration and Conciliation Board (Junta General de Conciliación y Arbitraje). In July, as instructed by the arbitration board, a commission of financial experts was formed that investigated the petroleum companies' finances, concluding that their profits easily permitted them to cover the demands of the workers. The report stated that just one company (El Aguila) had received annual profits of over 55 million pesos. The arbitration board concluded that the oil companies should pay 26 million pesos for wages and benefits to the workers.
The companies, however, insisted the demands would cripple production and bankrupt them, and refused to pay. The president once again intervened to mediate between the parties, and met with oil company representatives at the National Palace on September 2. In this meeting, one of the El Aguila representatives took issue with the description of it being a foreign company, and stated that El Aguila was a Mexican company. In response,
But, on December 8, the companies hired other unemployed workers and had not responded to the arbitration board. On December 18, 1937, the board gave a verdict in favor of the union by means of a "laudo" (binding judgment in arbitration) which demanded that the companies fulfil the requirements of the petitions and pay 26 million pesos in lost salaries. The petroleum companies initiated a lawsuit on January 2, 1938 before the
Consequently, the foreign companies rebelled against the imposed contract, and the maximum Judicial Authority responded by rendering a decision on March 1, giving the companies until March 7 to pay the 26 million pesos penalty.
In 1935, all companies in the business of extraction, processing, and exporting of oil in Mexico were foreign companies with foreign capital. These companies attempted to block the creation of
On December 27, 1935, the Sindicato Único de Trabajadores Petroleros was created, despite the legal opposition in the
Lázaro Cárdenas intervened between the union and the oil companies in order to force an agreement on the contract. The strike was delayed for six months, but the companies never agreed to the contract and on May 28, the strike took place. The entire country was paralyzed for 12 days, with consumers unable to buy gasoline. Cárdenas convinced the union to end the strike until a decision by the companies could be made. However, the companies declared themselves unable to meet the demands because of financial problems. Cárdenas ordered an investigation and on August 3, and the findings were that the