The Competition Council reported that in the first quarter of 2024, the profit margins for Morocco's nine fuel distribution companies averaged 1.46 dirhams per liter for gasoline and 2.07 dirhams per liter for diesel, with gross margins showing a downward trend. In a new report on the implementation of commitments made by wholesale fuel distribution companies as part of their conciliation agreements with the Competition Council, the body reported that during the first three months of 2024, the profit margins of the nine fuel distribution companies averaged 1.46 dirhams per liter for gasoline and 2.07 dirhams per liter for diesel. The board confirmed that the average and weighted average gross margins on gasoline sales fluctuated during the same period, ranging from a minimum of 1.24 dirhams per liter to a maximum of 1.69 dirhams per liter. For diesel, the gross profit margins remained higher compared to gasoline, ranging from a low of 1.76 dirhams per liter to a high of 2.36 dirhams per liter. The board explained that the evolution of the average and weighted average gross margins on gasoline sales showed a downward trend for almost all distribution companies, decreasing from 1.69 dirhams per liter at the beginning of the year to 1.24 dirhams per liter at the end of March, reflecting a decrease of 0.45 dirhams per liter. Regarding diesel, the analysis of profit margin trends over two different periods revealed a peak in the first quarter of February. In the first period, from the first half of January to the end of February, a slight increase in gross profit margins was recorded, rising from 2.11 to 2.26 dirhams per liter, a difference of 0.15 dirhams per liter. In the second period, from the second half of February to the end of March, there was a decrease in profit margins from 2.15 dirhams per liter to 1.76 dirhams per liter, a difference of 0.39 dirhams per liter. Gasoline prices and purchase costs The board concluded that the evolution of gross profit margins is consistent with the analysis of the correlation between gasoline prices and purchase costs. The declining levels of gross margins observed as of February coincided with a period when purchase costs partially increased, while disposal prices did not change. The Council also noted that in the first quarter of 2024, total gasoline and diesel imports increased by 9.1 percent in volume, reaching about 1.47 million tons, and by 0.9 percent in value, totaling 12.89 billion dirhams on an annual basis. Regarding the correlation, the Council emphasized that the commoditization of gasoline and diesel on the national market follows the indiscriminate sale of these products. Overall, prices of these products at the global level and fluctuations in purchase costs, weighted by inventory changes, showed some differences at the level of gasoline. Additionally, it appears that distributors recorded a slight increase in purchase costs of 0.17 dirhams per liter for gasoline and 0.32 dirhams per liter for diesel. This increase is significantly lower than the rise in international prices for gasoline and diesel, which were 0.47 dirhams and 1.15 dirhams per liter, respectively. On the other hand, it appears that companies did not fully apply the price increase to the retail price. Instead, the latest price increase was set at 0.31 dirhams per liter.
