A massive fireball that engulfed people scooping up fuel spilling from a pipeline ruptured by thieves in central Mexico killed 21 people and badly burned 71 others in what was a chronicle of a tragedy foretold.

It came just three weeks after new President Andres Manuel Lopez Obrador launched an offensive against fuel theft gangs that drilled dangerous, illegal taps into pipelines an astounding 12,581 times in the first 10 months of 2018, an average of about 42 per day.

With crowds of townspeople often involved, either aiding thieves or collecting spilled fuel in primitive containers, it was only a matter of time before a fire occurred.

In fact, they have occurred before, but seldom with the scale and horrifying death toll of Friday's fire in the state of Hidalgo, which came as people collected the spilled gasoline in buckets, plastic jugs and garbage cans.

The leak was caused by an illegal pipeline tap in the small town of Tlahuelilpan, about 100 km north of Mexico City, according to state oil company Petroleos Mexicanos, or Pemex.

Video footage showed dozens of residents in an almost festive atmosphere as whole families gathered in a field as a geyser of fuel spouted dozens of feet into the air from the tap.

Footage then showed flames shooting high into the air against a night sky and the pipeline ablaze. Screaming people ran from the flames, some themselves burning and waving their arms.

Hidalgo Gov. Omar Fayad said 21 people were killed immediately and 71 suffered burns in the blast at the duct that carries fuel — apparently gasoline — from the Gulf coast to Tula, a city just north of Mexico City.

Pemex attributed the blaze to 'the manipulation of an illegal tap'.

Hidalgo state police said the leak was first reported at about 5 pm local time.

'There was a report that residents were on the scene trying to obtain fuel,' according to a police report. Two hours later, the pipeline burst into flames.

And another pipeline burst into flames in the neighbouring state of Queretaro on Friday, because of another illegal tap. Pemex said the fire near the city of San Juan del Rio was 'in an unpopulated area and there is no risk to human beings'.

In December 2010, authorities blamed oil thieves for a pipeline explosion in a central Mexico near the capital that killed 28 people, including 13 children.

That blast burned people and scorched homes, affecting 5,000 residents in an area 10 km wide in San Martin Texmelucan.

The blast will further focus attention on Lopez Obrador's fight against the $3 billion per-year illegal fuel theft industry.

'I greatly lament the grave situation Tlahuelilpan is suffering because of the explosion of the duct,' Lopez Obrador tweeted. He called on all branches of government to assist the victims.

He launched the offensive after taking office on December 1, deploying 3,200 marines to guard pipelines and refineries. His administration also shut down pipelines to detect and deter illegal taps, relying more on delivering fuel by tanker truck. There aren't enough trucks, however, and long lines at gas stations have plagued several states.

But Lopez Obrador faces resistance in his battle against fuel theft. Gangs have been able to win the loyalty of whole neighborhoods, using free gasoline and getting locals to act as lookouts and confront military patrols carrying out raids against the thefts.

It is unclear whether Friday's tragedy will turn the tide of opinion against the gangs in the impoverished villages that lie above the underground pipelines.

'I am calling on the entire population not to be accomplices to fuel theft,' Fayad wrote. 'What happened today in Tlahuelilpan must never happen again.'