The latest gasoline hikes in Mexico have pushed the cost of filling your auto on a par with the cheapest states for fuel north of the border.
Mexico’s mandated monthly gasoline increases kicked in November 1, with Magna fuel inching up to 10.72 pesos a liter, Premium to 11.28 pesos and Diesel to 11.08 pesos.
Magna is now priced at the equivalent of 40.52 pesos (3.06 dollars) a gallon, comparable with the average for South Carolina at 3.08 dollars (gasbuddy.com).
However, the cost of gas in more than two-thirds of U.S. states averages between 3.30 and 3.60 dollars a gallon.
Mexico’s federal government says the gas hikes are necessary, not just to raise prices to international levels but to reduce the massive subsidies it ploughs into the sector to keep pump prices artificially low, supposedly for the benefit of the less well-off.
But the government says it’s the nation’s wealthy, who use far more gasoline than anyone else, that gain most from the subsidies in the long run.
The cost of gasoline has risen by 60 percent since President Felipe Calderon took office in 2010. Filling an average-sized tank today costs around 530 pesos, compared with 335 pesos six years ago, Spanish-language daily Mural pointed out this week.
The government plans to spend more than 172 billion pesos on fuel subsidies this year, according to Mexico’s Finance Ministry (Hacienda).
Critics of the monthly gas hikes say that reaching parity of prices with the United States is a redundant goal, since purchasing power in the two nations cannot be compared.
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