The custodian of the country’s fuel supplies, the mines and energy ministry, is optimistic that circumstances surrounding fluctuations in international oil prices will remain positive for the foreseeable future. As such, they intend to maintain fuel prices which align to market fluctuations, with the primary goal of safeguarding the nation’s fuel supply.
A statement issued by the ministry on Friday stipulated that all fuel prices will remain unchanged for November 2023. This means the Walvis Bay retail prices for petrol will remain N$22.88 per litre, diesel 50ppm at N$23.15, and diesel 10ppm at N$23.35 per.
In addition, the National Energy Fund will absorb under-recoveries of 33 and 23 cents per litre on diesel grades, respectively.
“Oil prices experienced a significant decline of over US$5.00 in October due to a decrease in fuel demand, which outweighed the decision made by OPEC+ to maintain a reduction in oil production; thereby keeping the supply constrained. The supply of diesel, which serves as a proxy of demand, fell to around 8 million barrels per day (bpd), its lowest point since the beginning of the year. Additionally, crude oil prices declined approximately by US$I0.00,” the ministry stated.
Moreover, the minist r y’s calculations indicate that the price of Unleaded Petrol 95 during October 2023 averaged US$97.40 per barrel compared to US$112.65 per barrel at the end of September 2023. This translated into a decrease of about US$15.00 per barrel, or 13.5%.
Moreover, the average price of Diesel 50ppm during October 2023 decreased about US$6.00 per barrel or 5.2% and Diesel 10ppm decreased by 5.3% during the month. Also, the Namibia Dollar depreciated by 0.57% during October which, increased the foreign exchange burden to import fuel.
“Hence, upon incorporating all the input factors into the fuel pricing model, the ministry noted an over-recovery of 148 cents per litre on petrol and under-recoveries of 33 cents and 23 cents per litre on diesel 50ppm and diesel 1 Oppm, respectively,” the ministry stated.