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Government Speaks On Frequent Fuel Price Increases

1 year agoThu, 10 Mar 2022 07:41:51 GMT
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Government Speaks On Frequent Fuel Price Increases

Energy and Power Development Minister, Zhemu Soda, has said the frequent fuel price increases are a result of international developments which Zimbabwe has no control over.

He said over the past few days, fuel prices had risen significantly on the global market in the wake of Russia’s special military operation in Ukraine, which had affected supply trends as the former was the second-biggest producer of petroleum products in the world.

The Zimbabwe Energy Regulatory Authority (ZERA) Wednesday announced that the price of diesel had risen by 17 cents and petrol by 16 cents.

This was the second increase inside four days after ZERA on March 5 raised fuel prices to US$1.51 for both diesel and petrol. The hike attracted public outrage.

Minister Soda said the prices at which traders were selling fuel since the last review on March 5, was now below the cost of replenishing stocks. Since the last review, the cost of importing petrol and diesel has gone up by up to 11 per cent.

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At US$1,68 per litre now, diesel is 24 cents up from the February price of US$1,44, while petrol is now pegged at US$1,67 per litre.

ZERA also adjusted liquefied petroleum gas (LPG) prices, raising the retail price to US$2,07 from US$2,03 per kg.

Speaking at a media conference in Harare yesterday, Minister Soda said:

The war situation in Ukraine is constraining production and international movement of the commodity. It is a precarious situation; beyond our control.

Zimbabwe imports almost all of its fuel requirements. Any increase in the price of oil on the international market therefore translates into an increase in fuel prices in the country.

Occasioned by the conflict between Russia and Ukraine, supply of the petroleum products has been constrained, resulting in an increase in the FOB prices.

He said a rapid increase in oil prices on the international market demanded more frequent price reviews compared to when international prices were relatively stable.

Soda added that petroleum price reviews shall be done on a weekly basis to preserve the price of the products in line with the situation obtaining on the international market.

Asked whether Government could intervene to cushion users of fuel from the hikes, Minister Soda said if the situation continued, Government would find ways to lessen the burden.

Reacting to the latest round of increases yesterday, parliamentarians expressed concern at recent developments and urged Government to urgently look at ways of easing the situation.

Dzivaresekwa legislator Mr Edwin Mushoriwa said it was time the Government reviewed downwards, the level of taxes and levies imposed on fuel to cushion the public.

Deputy Minister of Finance and Economic Development, Clemence Chiduwa said the proposal was welcome but Treasury could not implement it alone.

More: The Herald

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