Fuel goes up

Fuel goes up

Floris Steenkamp

Motorists at the coast must brace for yet another fuel price increase. At midnight to-night, the price of petrol increases by 50 cents per litre and the price of diesel in-creases by 70 cents per litre.

The Ministry of Mines and Energy confirmed this in a press statement yesterday, citing a shortage of oil in the global market, in the wake of sanctions against Iran by the United States, as the main culprit. The demand for oil is currently high and subsequently market prices are high. Another factor is the weakening Rand against the main trade currency, the US Dollar, reads the statement.
It currently costs oil companies more to import a litre of fuel than the price at which it is sold to the Namibian consumer (under-recovery). The shortfall has to be subsidised by the National Energy Fund (NEF). The NEF is said to have spent in excess of N$470 million to subsidise the under-recovery in the past few months. Hence, fuel prices need to be increased in order to narrow the under-recovery margin and rather pushing for an over-recovery (when it costs less to import fuel than the price at which it is sold).
At Walvis Bay the new pump prices would be: 95-octane unleaded petrol N$13,95 per litre, Diesel 500ppm N$14,48 per litre and Diesel 50ppm N$14,53 per litre.

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