05 February 2014, Windhoek – A combination of a weak rand and slightly higher crude oil prices will see Namibians pay more and more for fuel this year. The price of fuel increased today. The last increase in the price of fuel was in August last year, and it remained unchanged since September that year.
At Wednesday 00h01, 95 Octane Unleaded Petrol will increase by 38 cents per litre (retail) to cost N$12,04 per litre, and Diesel 500 parts per million (ppm) will increase by 30 cents per litre to cost N$12,57 per litre.
The newly introduced Diesel 50ppm will increase by 34 cents per litre to cost N$12,67 per litre.
Making the announcement in a media statement issued on Monday, Minister of Mines and Energy Isak Katali said although crude oil prices in the oil region have been stable at the beginning of December last year, it has become a clear signal of an increase in crude oil prices.
He said the exchange rate between the Namibian dollar and the United States (US) dollar has depreciated greatly due to labour tensions in the South African labour market, thereby threatening the price of imports in the local market, and the oil industry was no exception from these adverse effects.
“This led to slight under-recoveries in the local oil industry in the period under review, and when this happens, fuel pump prices are expected to be adjusted upward so as to compensate for the cost incurred by oil companies to bring oil to our shores and keep the country supplied with enough fuel throughout the festive season,” he said.
Katali noted that the government will once more bear half of the cost of the resultant under-recoveries recorded.
If the rand’s depreciation continued unchecked, a petrol price of R16 per litre was possible in the medium-term, South Africa’s Automobile Association said on Monday.
“On 27 December, a dollar cost R10,35. By 27 January it cost R11.20.
“Meanwhile, international petroleum prices have ticked up slightly since our last review of fuel price trends in mid-January, so it’s a double whammy for motorists,” the AA said in a statement.
Last week, SA Reserve Bank governor Gill Marcus said the weak rand exchange rate affected the petrol price, which in December and January increased by an accumulative 55 cents per litre.