Goodbye to 'gasoline prices' for 6 months: They agree to sell a liter at 24 pesos

The Mexican government, gasoline business owners and participants in the fuel value chain have reportedly reached an agreement to stabilize the price of regular gasoline , voluntarily, at 24 pesos per liter, for the next six months, according to a document signed by President Claudia Sheinbaum , to which El Financiero had access.

The agreement will be announced next Thursday and will be supported by importers, marketers, distributors of gasoline brands, transporters and gas station dealers .

“During this six-month period, periodic evaluations will be carried out to determine its effectiveness and make adjustments and other necessary actions based on the results obtained,” the proposal reads.

This price stabilization policy will seek coordination between the Mexican government and the private sector to guarantee fair prices , and various efforts have been proposed to achieve this.

First of all, it is worth noting that the price of regular gasoline (less than 91 octane) must remain below 24 pesos per liter, except in border areas , since these regions already enjoy tax incentives that allow them to offer the product below this price.

To achieve this goal, Pemex will establish a national wholesale price for regular gasoline at storage and distribution terminals.

In addition, importing and distribution companies will adjust their strategies to transfer benefits to consumers, with a reasonable profit margin.

"(A) reasonable differential must be observed that does not exceed two pesos, not including the Value Added Tax (VAT), with respect to the wholesale prices at which Pemex and other importing and marketing companies sell," the text reads.

PEMEX will have to improve fuel distribution throughout the country to ensure that supplies reach all regions efficiently.

“Likewise, PEMEX will review those cases in which, due to logistics costs or other reasons, the reasonable differential is not sufficient to cover operating costs and investment recovery, proposing adjustments in coordination with the competent authorities,” the document highlighted.

The agreement also provides that the Ministry of Finance and Public Credit will continue to maintain fiscal incentives through the Special Tax on Production and Services (IEPS) on gasoline and that Profeco will continue to monitor prices and cost transparency, among other points.

In addition, all competent authorities of the Government of Mexico have committed to continuously and permanently maintaining working groups for the analysis of the regulations and technical standards applicable to fuels in order to identify areas for improvement.

"The objective will be to increase the effectiveness and efficiency of regulation , facilitate compliance and reduce regulatory costs," they said.