If you loaded up fuel for your car today, you’re probably wondering why the gasoline dropped. At some points in the country prices have been recorded in the gasoline 16 pesos per liter in the case of the regular one, as a consequence of the fall in the international prices of PetroleumHowever, there are different factors that influence its price and you we count which are.
The prices of fuel that end consumers observe at service stations are made up of five components:
- International references of gasoline prices.
- Exchange rate
- Logistics costs.
- Taxes.
- Profit margin of service stations.
In the first case, oil prices have fallen an average of 30 percent since March 6, This collapse was derived from a disagreement between the main crude oil producers, due to reducing production in an environment of lower demand due to the Covid-19 pandemic, which caused an oversupply.
In the case of exchange rate, the oil price it is set in dollars, so a depreciation of the peso against this currency implies a higher cost per barrel of crude, however, although the dollar has increased in price, this is offset by the sharp drop in the price of Petroleum.
The logistics cost ands another one of the factors that influence the price of gasoline. In Mexico, 70 percent of the volume consumed has to be imported, which implies that you have to travel by tanker, unload in a port, store it, and then transport it by pipe or pipeline to a terminal to tour what in the sector is known as the last mile, that is, the point of sale at service stations.
In addition, Mexicans pay tax for the gasoline we consume: Special tax on production and services (IEPS) Federal which is determined by the Secretary of Finance and Public Credit, established every week, according to the exchange rate, international oil reference prices and logistics costs.
The IEPS It is an indirect tax, which means that it is transferred to customers when they buy gasoline. You also pay a IEPS state; a fixed fee for one year, and which is updated according to inflation, as well as another IEPS for emissions CO2, which is a carbon tax and is applied to greenhouse gas emissions, as well as the Value Added Tax(VAT).
There is currently no incentive to IEPS, and said by the Secretary of the Treasury, Arturo Herrera, “a stimulus is the elegant way of saying that there is a subsidy and the only thing we do as the price of gasoline decreases, the stimulus decreases as well, which means that the subsidy decreases, so the gasoline price is like this, the reference goes up and down and the IEPS serves as a mattress“
How many earnings from service stations it is necessary to take into account the above factors as well as financial costs and operational (such as regulatory and administrative expenses) of each service station, such as the transportation of fuel from the storage terminals to the service stations which may vary according to the remoteness between these.
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