WINDHOEK – At one minute past midnight last night motorists started forking out 40 cents a litre more on all petroleum products, bringing the price of petrol at Walvis Bay to NS12.95 per litre, diesel 500ppm to NS13.28 per litre and diesel 50ppm to NS 13.33 per litre. While the new fuel prices are astronomical for Namibians, these figures are still below but are fast approaching the current average global petrol price of N$14.75 per litre.
According to a statement issued on Monday by Mines and Energy Minister Tom Alweendo, the major contributing factor to this latest fuel increment is the depreciating exchange rate between the Namibia Dollar against the US Dollar during the course of August, which jumped from an average of N$13.37 in July to an average of N$13.90 in August.
“The results of the latest fuel price review indicate that the oil importers paid more, per litre, than the actual cost to bring petroleum products to our shores. This is to say that the final figures recorded are way above the actual cost per product. Pricing under-recoveries recorded are substantial to trigger upward adjustments in the local pump prices in order to create cost-recovery equilibrium in the local market,” read Alweendo’s statement.
Alweendo stated that it is important to note the prices of petroleum products are regulated and as such the ministry has the responsibility to adjust the fuel prices on a monthly basis with the aim of ensuring that consumers are charged the actual fuel costs.
The value of fuel adjustments is done in conjunction with the assessment of the National Energy Fund account balance. The mandate of the National Energy Fund, amongst others, is energy price equalisation, which is a mechanism ensuring that sharp increases in oil prices do not have a significant (dismal) effect on Namibian consumers. “When the fund has a healthy account balance, it is therefore utilised to absorb more than half of the cost incurred during the period under review shielding the consumer from the effect of increasing the fuel pump prices by a large margin,” Alweendo explained.
“By increasing fuel pump prices, it is not the intention of government or petroleum product suppliers or fuel station owners to generate more income, but to recover the cost already incurred by bulk oil importers to bring fuel to Namibia,” he added.
As a general rule for global fuel prices, more developed countries usually have higher fuel prices while less developed countries and those that produce and export oil have significantly lower prices. The differences in prices across countries are also due to the various fuel taxes and subsidies.
All countries have access to the same petroleum prices of international markets but then decide to impose different taxes and as a result, the retail price of petrol vastly differs.
The price paid by consumers largely reflects national pricing policy as some regions, such as Europe and Japan, impose high taxes on petrol while others, such as Saudi Arabia and Venezuela, subsidise the cost of fuel.
In the most recent report by GlobalPetrolPrices.com, which publishes wide-ranging and reliable data on retail fuel prices around the world by tracking over 150 countries on a weekly basis, it is evident that Venezuela pays the least for petrol at about 13 cents per litre while Icelanders can pay up to N$27 for the same litre of fuel. On the African continent, countries that pay the lowest for fuel are Sudan (N$5.09 per litre) and Egypt (N$6.43 per litre) while Angolans pay about N$9 per litre. In the southern African region Zambia pays more than N$22 per litre while Zimbabweans fork out just under N$22 per litre.
2018-09-05 09:21:09 19 days ago