The Moroccan government is ready to regulate the fuel prices, and fuel companies will have no option but to comply with the final decision.
Rabat – After deliberations between the government and fuel distribution companies, the minister delegate of public affairs and governance, Lahcen Daoudi, stated on Sunday, March 24, that the government has reached a final decision to regulate the price of fuel.
After a final meeting between the government and the Moroccan Petroleum Group (GPM) which represents fuel companies on February 19, when fuel company representatives said regulation was reasonable, the companies have reportedly agreed to conform to the government’s final decision.
According to Daoudi, there is no disagreement between fuel companies and the government so far on the principle of oil price regulation.
“I have accomplished my mission and will hand my report to the head of government in order to put the agreement into practice in the near future,” said Daoudi, whose ministry has been negotiating with fuel companies.
Daoudi said that fuel companies had no option to block the regulation of oil prices, but some companies’ opposition made the decision difficult.
The government has been firm about regulating fuel prices despite the criticism of the Council of Competition, which described the move as unnecessary. The council said it “would harm industry stakeholders.”
In mid-December 2018, Daoudi, whose ministry regulates pricing, gave in to demands to regulate oil prices following complaints about the large profits companies had made in a two-year period.
An MP of the Democratic Left Federation party, Omar Balafrej, described the profits of fuel companies, which he estimated at MAD 17 million, as “unethical.”
“This [profit] would not have happened if it were not for the Council of Competition being frozen,” Balafrej argued.
He further asserted, “This huge amount of money would ensure that all Moroccan students benefit from free transport.”
He questioned why politicians have not talked about seizing companies’ legal profits. “It’s strange that none of the MPs or heads of parties have raised the issue of retrieving the 17 billion dirhams,” he said. “It’s not a ‘trivial’ amount.”
In 2015, the government liberalized the prices of fuel. According to one MP from the Justice and Development Party (PJD), Abdellah Bounau, fuel companies tripled their profits from MAD 300 million to MAD 900 million. Bounau chaired a committee of inquiry into oil prices last year.