Energía A Debate

MEXICO CITY (Argus) – Fuel retailers in the northwestern Mexico states of Sonora and Baja California have begun selling gasoline and diesel at market-driven prices as part of the country's ongoing energy liberalization.

Retail fuel prices in those states could vary from the maximum fuel prices that had been set by the finance secretary. The rest of the country will follow suit on a set schedule later this year.

“It is very difficult to anticipate what will happen with prices,” said Jose Carlos Femat, director of Onexpo, Mexico's largest association of fuel retailers.

In the now liberalized city of Tijuana, prices which fuel retailers are obligated to provide through a government website showed at 8am local time the average price in Tijuana for premium gasoline was Ps17.66/l ($3.55/USG), compared with a maximum price set by the government yesterday of Ps17.65/l.

Of the 196 stations reporting prices in the city, 190 of them charged the previous day's government-set maximum of 17.65/l. Three were charging the highest price reported, of Ps18.18/l. One station was charging 17.45/l, below the maximum price of the previous day.

Mexico's retail sector is underdeveloped and fragmented, with 80pc of fuel retailers owning from one to three stations, according to data from Onexpo. The country counts less than 12,000 stations nationwide, or one station for every 10,500 inhabitants, four times less than the one per 2,600 inhabitants ratio in the US, according to energy regulator CRE. Before the deregulation process began all stations were franchises of state-run Pemex.

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