Mexican gasoline prices fall USD$.0098, but only until Monday

Mexico's Ministry of Finance and Public Credit (SHCP) said on Friday that national gasoline prices would fall MX$0.02 cents (USD$0.0010) per liter on Saturday, but only for two days, as prices will be set on a daily basis as from Monday February 20, when the country moves toward a free market in gasoline.

For this weekend only, Magna gasoline is sold at MX$15.97 (USD$0.78) per lite, Premium gasoline at MX$17.77 (USD$0.86), while diesel can be found at MX$17.03 (USD$0.83).

The ministry rejected that the measure had any electoral bias and noted that maximum gasoline prices will be published daily on the web page of the Energy Regulation Commission (CRE), www.gob.mx/cre at four o’clock Monday. The ministry added that the maximum prices will reflect the daily fluctuations of international markets.

The government will seek to mitigate excessive fluctuations in alignment with the “soothing policy” that came into force two weeks ago. In an interview with EL UNIVERSAL, Miguel Messmacher, Undersecretary for Revenues of the SHCP highlighted that the measure is far from serving any electoral purpose: “There will be slight upward and downward fluctuations reflected in cents, I don’t see how this serves any electoral purpose...it is impossible to argue that a MX$2 increase at the beginning of the year reflects an electoral strategy. If it had been the case we would have hardly had that two peso increase in January, wouldn’t you say?”

Messmacher added that an extended formula is being used so as ti mitigate fluctuations in the national maximum prices and to create certainty for the economical agents in charge of analyzing and crating economic forecasts. Said formula was published in the Federal Official Gazette (DOF) yesterday, available at: http://www.dof.gob.mx/

Mexico raised gasoline prices at the start of the year, and the 14 percent hike in regular gas prices sparked protests and looting around the country. The hike helped drive the annual inflation rate in January to its highest level in more than four years. The government is expected to adjust the amount of tax it charges on gasoline in a bid to moderate price fluctuations this year.

In its statement, the government said a rebound in oil prices above estimates, that were used in the 2017 budget, and a stronger exchange rate "allow for more gradual movements" in gasoline prices "in a fiscally responsible way."