Niël Terblanché
In the face of ongoing global market fluctuations, the Ministry of Mines and Energy (MME) of Namibia declared that fuel prices for both petrol and diesel will remain unchanged in March
In a statement, the ministry said that despite experiencing a substantial under-recovery, calculated at 153 cents per litre for petrol and 114 cents and 106 cents per litre for 50ppm diesel and 10ppm diesel respectively, it opted to absorb these costs through the National Energy Fund (NEF).
To manage the under-recoveries without adjusting pump prices, the Ministry has raised the National Energy Fund levy by 50 cents per litre across all petroleum products.
The new NEF levy stands at 186.775 cents per litre for petrol and 160.775 cents per litre for diesel.
This adjustment ensures that the NEF can cover the under-recoveries, which total N$124 million, through the fuel equalization levy on behalf of Namibian consumers.
By absorbing the under-recoveries, the Ministry not only safeguards consumers from immediate consumer price increases but also contributes to the ongoing security of fuel supply in the country.
According to the statement, the decision to keep pump prices unchanged is aimed at shielding consumers from the impact of rising global oil prices, which have been influenced by production uncertainties and the speculative nature of member countries of OPEC+’s future production decisions.
The ministry’s review for March 2024 is set against the backdrop of a challenging global oil market.
Crude oil prices have seen an uptick, with the average price of Unleaded Petrol 95 rising by 6.5 percent and Diesel 50ppm by 4.06 percent over the previous month. The average price of Diesel 10ppm also increased by 3.87 percent. The ministry said these adjustments are attributed to the speculative environment surrounding OPEC+ production cuts and the ensuing supply concerns.
Further complicating the economic landscape is the depreciation of the Namibian Dollar against the United States Dollar, which fell by 0.97 percent in the period leading up to February 2024.
Despite these challenges, the Ministry has decided to maintain the current fuel prices at NS 20.78 per litre for petrol, NS 21.05 per litre for 50 ppm diesel, and NS 21.25 per litre for 10 ppm diesel, at the pumps in Walvis Bay.
