Mexico’s federal government and at least 32 gas station companies agreed on April 17 to cap diesel prices at 28 pesos per liter (about $1.64 USD), lowering an informal ceiling of 30 pesos that had been in place since early April. The Secretariats of Energy, Defense, and Finance (SHCP) announced the deal in a joint statement, citing rising international fuel costs driven by conflict in the Middle East.
The agreement is voluntary but broad. Pemex, the national energy regulator CRE (Comisión Reguladora de Energía), the consumer protection agency Profeco, the environmental safety agency ASEA, and the Guardia Nacional all participated in brokering the deal. The government has used a similar strategy for regular gasoline, keeping Magna prices below 24 pesos per liter at most stations nationwide for roughly a year.
Fiscal Stimulus Covers Part of the Tax
For the week of April 18 to 24, SHCP will apply a fiscal stimulus on diesel of 3.18 pesos per liter, absorbing a large share of the IEPS fuel excise tax. Consumers will pay the remaining 4.18 pesos per liter of that tax. On regular Magna gasoline, the subsidy is smaller: 0.78 pesos per liter, leaving drivers to cover 5.91 pesos per liter in tax.
Both subsidies are smaller than in previous weeks. Diesel subsidies have covered more than 70% of the IEPS tax component in recent months as Brent crude surpassed $100 per barrel. The weekly adjustments mean prices could shift again after April 24.
What This Means at the Pump in Baja
Before this agreement, the national average diesel price had climbed to around 28.41 pesos per liter (about $1.64 USD) as of mid-April, near historic highs. The new cap brings modest relief. Drivers filling a standard 70-liter diesel truck tank will pay no more than 1,960 pesos (roughly $115 USD) instead of the 2,100 pesos ($123 USD) they faced under the old 30-peso ceiling.
Diesel also powers most freight, agriculture, and construction across the Baja California peninsula. Lower diesel costs reduce shipping expenses for goods moving south from Tijuana and Mexicali to resort and retirement communities in Los Cabos, La Paz, and Loreto. Magna gasoline, which most passenger cars use, sees only a small subsidy, so drivers of gas-powered vehicles will notice little change.
The cap is temporary and tied to global market conditions. If international crude prices drop, the government could scale back its fiscal stimulus. If prices climb, the subsidy bill grows for Mexico’s treasury. As originally reported by La Jornada BC, the agreement involves coordination across multiple federal agencies and depends on voluntary compliance by fuel retailers.