October saw a new big player being permitted for gasoline imports with Cogent Energy Solutions getting two permits for a combined 11.8 billion liters. This makes the Houston-based crude oil, condensate and refined products distribution and marketing company the fourth private company to be permitted for the import of more than 10 billion liters of gasoline after Vitol, Santa Fe Energy Group, and IF Vertical since the fuel import market was liberalized.
The company with the greatest import allowance still remains PEMEX Transformación Industrial with 34 billion liters for the period between July 11, 2017 – July 11, 2018. All around oil giant Vitol which also is active in Mexico’s upstream by way of its subsidiary Pemisa head the group of private companies with a 20 billion liter permit, followed by Santa Fe Group a conglomerate partnered with several Indonesian oil companies which has a permit to import 17 billion liters and Gulf oil subsidiary IF Vertical with 16.8 billion liters.
In total 308 billion liters of gasoline have been permitted by the CRE since June 2, 2016. Nonetheless the impact of greater competition on oil prices remain to be felt as the gasoline price has gently risen from January 2017 when it was MX$17.3 per liter to October 2017 when it reached MX$17.8 per liter mirroring a similar rise in US gasoline prices.
Importantly US prices were on average US$0.73 per liter in October 2017 while Mexican oil prices were US$0.94 per liter that same month, for the moment the Mexican consumer pays 29 percent more for gasoline than his US counterpart.
Gasoline prices and the introduction of gas stations run by foreign brands are the most visible part of the Energy Reform for the Mexican citizenry. Therefore, the development of gasoline prices in the run-up to the 2018 elections will likely be a politically charged issue.