Festive season comes with fuel price relief for motorists
Fuel prices for 95 Octane Unleaded Petrol will decrease by N$1 per litre while diesel all grades will decrease by 40c per litre effective 5 December around midnight, the Ministry of Mines and Energy announced on Friday.
Thus, the new fuel pump prices in Walvis Bay will be: 95 Octane Unleaded Petrol, N$12.95 per litre, Diesel 500ppm (N$14.08) and Diesel 50ppm (N$14.13) while pump prices countrywide will also be adjusted accordingly.
Internationally, oil prices fell by approximately 30 % since peaking last in early October. On Friday, Brent crude oil traded at US$56 down from US$80 recorded just 8 weeks ago.
The Minister of Mines and Energy, Tom Alweendo in a statement said that the ministry, through the National Energy Fund is ensuring that the full costs of oil supply are not paint-passed onto consumers at the pumps.
“The ministry applauds the latest developments in the international oil market, especially at a time of the festive season when many Namibians will be travelling long distances to various holiday destinations while others will be engaging in seasonal farming activities. Moving forward, the ministry will, therefore continue to take all necessary measures to ensure that Namibian fuel consumers are supplied with fuel products at fair prices,” Alweendo added.
According to Research Associate at the Economic Association of Namibia, Klaus Schade, the Namibia Dollar appreciated on average by 2.8% in November to N$14.09 per US dollar compared to the monthly average of N$14.50 per USD in October 2018, which contributed to lower landing costs of fuel in the country.
However he said that the current drop in oil prices highlights the volatility in the global oil market that is influenced not only by the performance of the global economy, but also by geopolitical factors such as the tensions in the middle east.
“The current declining oil prices are mainly caused by a global slowdown of the economy due to continuing uncertainties surrounding the global trade system, which is not good news for Namibia. Slower global economic growth results in lower demand for basic commodities and hence lower prices, which hits commodity exporters such as Namibia. Furthermore, lower oil prices will slow down the recovery of the Angolan economy and subsequently the Angolan demand for Namibian goods and services,” Schade said.
He further stressed that lower fuel prices should not result in complacency on the part of consumers, producers and policy makers to embark on more fuel-efficient transport and production equipment and, moreover, move to electrical vehicles and equipment.