- Title: Mexico gasoline prices to rise as much as 20.1 pct in Jan -gov't
- Date: 28th December 2016
- Summary: MEXICO CITY, MEXICO (DECEMBER 28, 2016) (REUTERS) CLOSE-UP OF THE LANDMARK ANGEL OF INDEPENDENCE MONUMENT GENERAL OF CARS DRIVING DOWN THE REFORMA AVENUE WITH THE LANDMARK ANGEL OF INDEPENDENCE MONUMENT CAR PULLING INTO A GAS STATION CLOSE-UP OF GASOLINE PRICES AT STATION
- Embargoed: 12th January 2017 21:01
- Keywords: Mexico fuel inflation prices discontent diesel
- Location: MEXICO CITY AND LEON, GUANAJUATO, MEXICO
- City: MEXICO CITY AND LEON, GUANAJUATO, MEXICO
- Country: Mexico
- Topics: Commodities Markets,Economic Events
- Reuters ID: LVA0015ESSHMR
- Aspect Ratio: 16:9
- Story Text: Mexican gasoline prices will rise by as much as 20.1 percent next month compared to the highest recorded prices in December, the government said on Tuesday (December 28), as part of a programme to end years of government-set prices at the pump.
In a statement, the finance ministry said the widely used Magna gasoline brand will rise 14.2 percent and will sell at an average price of 15.99 pesos (78 cents) per litre at retail, while Premium fuel will go up 20.1 percent to an average of 17.79 pesos per litre.
Diesel will rise 16.5 percent, with an average price of 17.05 pesos per litre.
The ministry's price ceilings will be in effect through February 3. After that, the maximum price will be set bi-weekly, until February 18, when it will be set daily.
"It's really pretty tragic because for us (taxi drivers) yeah, it really affects us seeing as we drive all around and fuel is what allows us to work and when they raise it (prices) that much, yeah, it's serious," taxi driver Gerardo Alcantara said.
Analysts said the liberalization programme was likely to have an impact on inflation, which has already passed the central bank's 3 percent target due to a sharp peso depreciation.
"It's really bad. They don't stop to think how it affects families. I mean, they raise taxes, they raise food (prices), I mean everything starts to go up and with the minimum wage which they say was just raised, but it really isn't enough. It's not enough for the basics. So yeah, we're completely against this hike," Mexico City resident Ana Montanez said.
Earlier this month, the energy regulatory commission said a staggered fuel price liberalization will begin at the end of March and extend through the rest of 2017.
The move will phase out government-set gasoline prices, a practice that has prevailed in Mexico for decades, and replace them with market prices.
The change is one of the most tangible parts of a landmark energy reform programme in Mexico, which in 2013 ended the 75-year monopoly of state oil company Pemex over nearly all facets of the sector, from crude production to retail fuel sales.
In April, Mexico allowed private companies to import fuels for the first time, nine months ahead of what the energy reform program originally stipulated.
The reforms also paved the way for private companies to establish their own non-Pemex branded gas stations for the first time since the 1930s. That began earlier this year.
Gasoline prices in Mexico are higher than in the United States, where market prices prevail, and Pemex loses about $3 billion dollars a year importing gasoline into Mexico, according to Nomura analyst Benito Berber.
- Copyright Holder: REUTERS
- Copyright Notice: (c) Copyright Thomson Reuters 2016. Open For Restrictions - http://about.reuters.com/fulllegal.asp
- Usage Terms/Restrictions: None