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Fuel Prices left unchanged for October

Fuel Prices left unchanged for October

Business Reporter

THE ministry of mines and energy has announced a decision to keep the fuel pump prices unchanged for October 2019.
In a statement, mines and energy minister, Tom Alweendo, stated that fuel pump prices in Walvis Bay will remain unchanged, with 95 Octane unleaded petrol denting the pocket by N$13.05 per litre and Diesel 50 ppm at N$ 13.63 per litre.
Giving a summary on the status of the global oil market, Alweendo stated that the highlight of September 2019 in the global oil market was the attack on Saudi Arabian oil facilities.
“Initial fears that oil prices will drastically rise were quelled when the state oil producer, Saudi Aramco, announced that the facilities will be restored back to full capacity as soon as possible.  The market volatilities contributed to measured increases in oil prices. Refined oil traded at an average of US$72 and US$77 per barrel of petrol and diesel, respectively, in September 2019, in comparison to a final an average of US$69 and US$74 per barrel of petrol and diesel in August,” Alweendo said.

UNCHANGED: picture for illustrative purposes only. Photo: Zorena Jantze

He further stated that the average exchange rate improved slightly in favour of Namibia, dropping to an average of N$14.9/US$ for September from a final average of N$15.2/US$ in August.
Alweendo stated that all these factors resulted in moderate under-recoveries recorded on fuel pump prices.
“The 2017 Petroleum Activities Return (PAR) report indicates that oil companies are failing to generate sufficient returns on their investments in the petroleum sector. Thus, an adjustment in their margins to a level that would encourage sustainability and further investment is required. The ministry has therefore decided to increase the industry margin by 3 c/l from 93 c/l to 96 c/l on all the prices regulated fuel products. The effective date for this adjustment is 2 October 2019,“ Alweendo further added
The under-recoveries per product on the basic fuel price (BFP) import parity land in Walvis Bay as calculated at 24 September 2019, N$34.715 c/l for 95 Octane unleaded petrol and N$32.358 c/l for Diesel 50ppm.
“Traditionally, under-recoveries call for equivalent increases in local fuel pump prices. However, the National Energy Fund, which absorbs under-recoveries on behalf of consumers from time to time, is in a stable financial position and will thus absorb the under-recoveries recorded during this month. The Ministry will thus keep fuel pump prices for the month of October 2019 unchanged, “ Alweendo concluded.