Morocco: Fuel Companies Singled Out for Excessive Profits
The president of the National Front for the Safeguarding of the Moroccan Oil Refinery “Samir”, El Houssein El Yamani, accused players in the fuel market of making excessive profits reaching on average 8 billion dirhams per year, or a total of 64 billion dirhams since the liberalization of prices in 2016.
El Yamani explained in a statement that, according to international market prices and based on the calculation method before the liberalization of prices by the Benkirane government, the price of a liter of diesel should not exceed 10.65 dirhams instead. of 12.20, and that of gasoline 12.23 dirhams instead of 14.40, during the second half of June.
Profits Deemed Indecent
He insisted on the fact that anything above these figures practiced before liberalization constitutes “indecent profits” for players in the sector. According to El Yamani, by analyzing the selling price of diesel in stations today, we can divide it into three parts: 50% for the purchase price on the international market, 30% for taxes, and 20% for distributors and importers.
In addition, El Yamani criticized the attitude of the Akhannouch government, which he accused of remaining passive in the face of “serious damage caused to the purchasing power of Moroccans.” He estimates that this damage is largely linked to the increase in the price of diesel, from an average of 8 dirhams before liberalization to more than 16 dirhams in the summer of 2022.
El Yamani also denounced what he called the “domination of fuel lobbies on the markets and their price control”, while criticizing the Competition Council for not having been able to impose significant sanctions, or even mention the name companies involved in transactional and amicable fines.
The Solution: Return to Refinery Regulation and Stimulation
For El Yamani, getting out of this situation requires a return to price regulation, a reduction in tax pressure and the dismantling of agreements between market players. He proposes to stimulate the oil refining industries, particularly at the Mohammedia refinery, which would generate a profit of more than two dirhams per liter in refining. He also suggests separating distribution activities from import and storage activities for greater transparency and competitiveness.
In conclusion, El Yamani calls for urgent measures to remedy the current situation, arguing that price regulation and activation of national refining capacities are essential to alleviate the economic burden on citizens and restore a fair balance in the fuel market.
