As fuel prices at the kingdom’s gas stations rise again amid international tensions, the national regulator is planning a major reform of existing pricing practices.
Rabat – In Morocco, the cost spiral at the petrol pumps has turned again. As reported by the Le360 portal, oil companies are preparing a price increase on April 16, particularly affecting diesel fuel. In the economic center of Casablanca, the price for a liter of diesel rose by around one dirham from 14.50 to 15.50 dirhams (MAD). This means that the price of diesel has broken through the psychologically important mark of 15 dirhams and is now on a par with the price of petrol, which remains unchanged at around 15.50 dirhams.
Global political tensions are putting a strain on local purchasing power
The recent price increases are closely linked to the volatility on the international energy markets, which is particularly fueled by the conflicts in the Middle East. Since these tensions erupted, diesel has increased by more than MAD 4.70 per liter, while gasoline has become more expensive by around MAD 3. This development represents a significant burden on the purchasing power of Moroccan households.
To cushion the impact, the government is maintaining its support mechanism for transport professionals. After a first phase that ended in mid-April, according to Le360 sources, there are signs that direct aid will continue. Nevertheless, political actors and trade unions are calling for further steps, such as a reduction in VAT or a cap on profit margins in retail.
Competition Council criticizes rigid price cycles as a market anomaly
In parallel with price developments, the authorities are focusing on price setting methodology. Ahmed Rahhou, president of the Moroccan Competition Council, described the current practice of synchronized price adjustments every 15 days to Le360 as an “anomaly.” Although prices have been officially free since the market was liberalized, almost all providers change their prices simultaneously on the 1st and 15th of each month.
According to Rahhou, this does not constitute illegal price fixing at this point, but this bi-monthly rhythm is more like a relic from the time before the market opened. The Council is now calling on companies to move away from this fixed periodicity and instead pursue individual pricing strategies that are based on their own inventories and cost structures.
More dynamism should create price advantages for consumers
The purpose of this initiative is to stimulate competition more strongly. The regulator believes that complete freedom in setting prices would tend to lead to delayed increases and accelerated decreases. “Complete freedom tends to lead to delayed increases and accelerated declines,” Ahmed Rahhou is quoted as saying. The logic behind it: In a dynamic market, providers hesitate to increase prices in order not to lose customers, while reductions are immediately used as a competitive advantage.
The Competition Council is currently still committed to a cooperative transition and has asked market participants to submit their own proposals for new pricing mechanisms. However, if the industry collectively sticks to the rigid 15-day model, the authority expressly reserves the right to use other regulatory means to force real competition in the interests of consumers.
Morocco – Competition Council files lawsuit against fuel companies (gas, petrol, diesel).
Source:
maghreb-post.de
