Would you buy gas in Mexico? It's $2.91 a gallon

Written by
Morgan Lee
1:42 p.m., March 7, 2012

TECATE — A few miles from some of the highest pump prices in the U.S., regular unleaded gasoline was selling Wednesday for $2.91 a gallon — all across Mexico.

Surging retail gas prices in Southern California and a relatively weak Mexican peso have pushed the spread between Mexico’s state mandated gas prices and the average retail price in San Diego to $1.46 a gallon.

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Construction worker Cruz Zamora put about $10 worth of gas in his pickup truck at a station in Tecate before heading to work across the border near San Diego.

“I just don’t have the money to fill it up over there” in the U.S., said the Tecate resident.

Average San Diego gasoline prices leveled off last week at $4.37 and have not changed in six days, according to AAA’s daily fuel gauge report. The highest prices ever for this time of year are a consequence of political tensions with Iran, growing demand from developing nations like China and refinery issues on the West Coast, analysts say.

Fluctuating gas prices and exchange rates have long been part of household economics for commuters at the world’s busiest border crossing between Tijuana and San Diego.

Rich in oil reserves, Mexico still imports about half of its gasoline supply for lack of refining facilities, heavily subsidizing retail prices in the process. Current retail prices were set in mid-February by Mexico’s treasury department.

Meanwhile, high U.S. gas prices has been accentuated by a nearly 8 percent decline in the value of the Mexican peso over the past year.

California’s seasonal gasoline blends, among the cleanest-burning in the world, are more costly to produce. And Mexican gas goes farther in other ways: California gasoline contains about 10 percent ethanol, lowering its energy content by 3 percent.

There is little evidence, however, that car drivers are making many special trips across the border to fuel up, said Kalid Gomez, general manager of a 42-pump station a mile from the Otay Mesa border crossing on the U.S. side.

“People don’t necessarily cross into Mexico to get gas for their car,” said Gomez, whose companion Valero-Truck.net fuel stations rely on oversized storage tanks and a combination of branded and off-brand fuels to stay competitive along the border.

But truckers, who might buy 300 gallons at once, are taking advantage of the price differential anytime they cross the border.

“It kills us,” said Gomez. “Just one tank full and you’re talking $300 in savings.”

Diesel prices diverged even more: $2.93 in Mexico versus a $4.50 on average for San Diego. Gomez said his station can still entice truckers with up to a 50 cent margin over Mexican prices.

Would you buy gas in Mexico? It's $2.91 a gallon | UTSanDiego.com