Freezing diesel would cost US$13.6 million a day
The Mexican government's efforts to keep the price of diesel at US$1.56 per liter are currently costing US$9.4 million a day; however, in the worst-case scenario, this could rise to a fiscal cost of up to US$17.8 million a day, according to experts.
“Keeping diesel prices frozen at 27 pesos is no gift—it’s a silent fiscal time bomb. If international prices rise, Mexico could burn through billions of pesos every month just to maintain it,” warned energy expert Ramsés Pech.
Pech confirmed that currently, diesel is sold in the United States (U.S.) at a record price of approximately US$1.68 per liter—that is, about US$0.11 above the price cap established in Mexico through a voluntary agreement between the federal government and the gasoline sector.
The expert noted that in the worst-case scenario—in which supply chains could be disrupted due to conflicts in the Middle East and Ukraine, leading to a halt in exports, new sanctions, or attacks on refineries—the price of diesel in the U.S. could skyrocket to nearly US$1.91 per liter by the end of 2026.
Because of this, Pech explained, the fiscal cost to the federal government of maintaining the cap at US$1.56 per liter would be US$2.1 billion between September and December 2026, which would amount to US$17.8 million per day.
If market conditions remain as they are now, the price of diesel in the U.S. would rise to nearly US$1.79 by December. That said, the final cost to Mexico of keeping diesel at US$1.56 would be US$1.6 billion between September and December—or US$13.6 million per day—according to the expert.
If the outlook were to become more optimistic and supply were to recover due to an end to the conflicts, the fiscal cost to the Mexican government of keeping the price of diesel at US$1.56 would be US$671.9 million during the last four months of the year, equivalent to US$5.3 million per day.
Furthermore, as part of the voluntary agreement between the government and the gas station industry, the Ministry of Finance has granted a tax incentive equal to 100% of the IEPS tax on fuel, along with additional subsidies, in order to mitigate the impact in Mexico.
