Mexico's Opposition PAN Party to Seek Fuel Price Deregulation Nacha Cattan and Adam Williams - Bloomberg News
go to original February 11, 2014

A Mexican opposition party that was key to passing the country’s energy overhaul last year will seek to have the market, not the government, set gasoline prices, said a member of the party on the Senate energy committee.

The National Action Party, or PAN, wants to deregulate prices as competition improves in the industry because of the new law, Senator Jorge Luis Lavalle said in a telephone interview today. Government involvement served its purpose by gradually removing subsidies to fuel costs, which are at market price, allowing the practice to eventually end, Lavalle said.

The push comes after Mexico’s ruling PRI and PAN parties broke a 75-year state monopoly on oil and gas drilling in December and as Congress is poised to discuss secondary legislation to implement the law. In January, Mexico started this year’s monthly 9-centavo-per-liter increases in gasoline as it reduces subsidies to curb consumption and keep government spending in check.

“The gradual reduction in subsidies that gasoline prices have had for many years now has accomplished its goal,” Lavalle said. “This has to be a strategy not only of deregulation of prices, but eventually we have to see competitiveness.”

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