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U.S. Truckers Find Cheaper Fuel South of the Border

The Trucker News Services

4/11/2008

REYNOSA, Mexico — Some truckers and other motorists from the United States are paying much less for diesel and gasoline in Mexico than north of the border, according to an article in The Monitor of McAllen, Texas.

 

 

Staff writers Kyle Arnold and Jared Taylor co-authored the article. It stated that trucker Juan Saldaña stopped his big rig at a 7-Eleven along Federal Highway 2 on his way to McAllen.

 

 

“Wearing a Texas Rangers baseball cap, the Monterrey-based truck driver would have had enough fuel to make the trip there, but he decided to top off his tanks anyway,” the article continued.

 

 

It added that “Saldaña bought about 18 gallons of diesel for just under $38, paying 5.76 pesos per liter, or about $2.07 a gallon. Had he waited until he crossed the Pharr-Reynosa International Bridge to top off, he would have paid more than $72 for the same quantity of diesel.

 

 

“Dozens of independent truck drivers from the Rio Grande Valley and as far away as Wisconsin parked their trucks at a pull-off stop along Expressway 83 in Alamo on April 1 to protest the high cost of diesel fuel — now hovering around $4 per gallon in this region. Similar protests took place along highways across the country that same day.

 

 

“In Mexico, state-owned oil company Pemex distributes gasoline and diesel. Although the country opened up gasoline prices to market forces in the early 1990s, prices for diesel are still set by the government.

 

 

“Looser environmental standards in Mexico also make producing the fuel cheaper there than in the United States, said Laurie Falter, a research economist with the Energy Information Administration, an independent statistical and analytical agency within the U.S. Department of Energy.

 

 

“On top of the diesel price controls, the Mexican government also grants commercial motor carriers a 20 percent discount. Other drivers pay about $2.45 a gallon.

 

 

"The government asks us to buy it in Mexico," said Daniel Flores, who works for a Reynosa trucking operation.

 

 

“Fuel prices have been on the rise the past five years, and diesel has been particularly susceptible to price spikes due to growing appetites for the fuel in Europe and Asia.

 

 

“Vehicles that run on diesel are growing in popularity in those regions due to the vehicles' superior fuel economy compared to gasoline-powered vehicles, as well as the tendency of diesel engines to last longer than gasoline engines.

 

 

“Patricia Gutierrez manages the filling station that Saldaña and other truckers stopped at to fill up before they headed for the border crossing. She said U.S. truckers and other motorists are increasingly taking advantage of the lower diesel prices south of the border.

 

 

"There are a lot who come here from over there," she said in Spanish.

 

 

North of the border, Rio Grande Valley truckers and businesses say diesel fuel has been cutting into their bottom lines.

 

 

"Of course it affects us. It's affecting everybody," said Robert Long, chief financial officer at McAllen motor carrier USA Logistics.

 

 

"And when we raise our prices, it's just passed down to the consumer."

 

 

“Diesel cost $3.99 per gallon Thursday at many stations in the Valley. With prices like that, the fuel is the largest operating expense for the USA Logistics' 550-truck fleet,” Long said.

 

 

“Edinburg business owner Alex Hernandez runs a portable toilet company. He considered driving a tanker to Reynosa to pick up fuel for his 10-truck fleet. Unfortunately for Hernandez, though, the fuel can't be exported without paying a hefty tariff.

 

 

"I'm just trying to find a way to lower my costs," he said.

Posted: Monday, April 14, 2008 2:33 PM by Herb Kinsey

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