By LAURENCE ILIFF
MEXICO CITY -- Mexico's antitrust authorities said Tuesday
they have fined state-run oil monopoly Petroleos Mexicanos, or
Pemex, 653 million pesos ($50 million) for maintaining a
stranglehold on the distribution of gasoline and diesel to
privately-owned gas stations, and that they have ordered Pemex
to end the practice.
The ruling comes in the middle of a contentious debate in
Mexico over opening up the oil sector to more private
investment, both in oil and gas exploration and production, and
Pemex said it will contest the ruling, arguing that the
Federal Competition Commission, or CFC, doesn't have
jurisdiction over its constitutionally established
Antitrust commissioners voted 3-2 that Pemex's legal
monopoly over the production and sale of motor fuels doesn't
extend to distribution of the fuel, and that it can't force gas
station owners to use its distribution network. The regulatory
body gave Pemex 30 business days to present a plan for
compliance. It said that Pemex, through a series of agreements
reached with the oil workers union, has gradually squeezed out
competing third-party distributors.
Ending the distribution monopoly could save one billion
pesos a year in transportation costs. As a result, those costs
wouldn't be passed on to taxpayers in the form of fuel
subsidies, the commission said.
Government-set fuel prices and subsidies are established by
a complex formula that includes transportation costs.
Pemex said Monday that the CFC was on questionable legal
"The CFC resolution was taken with two "no" votes out of the
five commissioners on the grounds that the commission does not
have jurisdiction to interpret regulations in the energy
sector, and that the transportation and distribution of refined
products are strategic activities that must be carried out by
Petroleos Mexicanos," the company said in a prepared
The commission's ruling, should it stand, "would cause
serious damage to Petroleos Mexicanos and its workers," the
David Shields, an energy analyst based in Mexico who
publishes the magazine and website energiaadebate.com, said the
distribution chain of gasoline and diesel from refinery to fuel-station appears to
exist in a legal void in which the only authorized distributors
are Pemex and companies holding Pemex contracts.
The gas station industry group Amegas, which represents
about 11,000 Pemex franchises, has asked that the government
address ongoing problems in Pemex's franchise system as part of
its energy-overhaul proposal.
In a July presentation, the association complained of a
large black market in motor fuels, and of Pemex fuel tankers
that deliver less fuel than they bill for.
Dow Jones Newswires