Falling fuel prices could bring relief to consumers

NAMIBIANS can expect fewer commodity price increases in shops and possibly a reduction in taxi fares if the trend of falling fuel prices continues through the year.

Petrol prices will fall by eight to nine cents a litre at 00h01 tomorrow, while wholesale diesel prices will fall by about seven cents a litre. This will be third fuel price reduction since July last year.Fuel prices fell by 10 cents a litre in July and by 20 cents in October last year.The prices are adjusted by Government every quarter.Thomas Mulunga, President of the Namibia Bus and Taxi Association (Nabta) said yesterday that his organisation would closely monitor the fuel price situation.Although a final decision would be made by the management committee, Mulunga did not think taxi or bus fares would rise in the near future unless petrol prices did.”If we see the trend [of fuel prices falling] is long-term, and not just for three months, then we may bring prices [fares] down,” Mulunga said by telephone.Joel Hinaunye Eita, researcher at the Namibian Economic Policy Research Unit (Nepru), said it was “difficult to predict” how international oil prices would move, as they depended on political developments in the Middle East.As long as the situation in the oil rich region remained volatile, the oil price would be unstable, Eita said.But tomorrow’s decrease would nevertheless have a “positive impact on the cost of doing business,” as fuel was a major cost to businesses and consumers alike.In a press release announcing the fuel price cut, Mines and Energy Minister Nickey Iyambo said during the last three months of 2003, there has been an upward movement in crude oil prices, which increased from US$27 to US$30 per barrel.This was, however, offset by the strengthening Namibian dollar-US dollar exchange rate, which improved by 28 per cent last year.The fuel price cut should contribute to a relatively benign inflation outlook for 2004, Eita said.Provided the Namibian dollar, and the rand to which it is pegged, remained stable Namibians could expect a stable or declining inflation rate for much of this year, Eita said.Below is what fuel will cost (in N$) in some towns, with effect from Wednesday. Town Leaded Unleaded Diesel Katima Mulilo 3,62 3,66 3,54 Rundu 3,62 3,66 3,54 Oshakati 3,61 3,65 3,54 Tsumeb 3,61 3,65 3,54 Otjiwarongo 3,56 3,60 3,48 Okahandja 3,54 3,58 3,46 Windhoek 3,56 3,60 3,49 Walvis Bay 3,41 3,45 3,33 Gobabis 3,62 3,66 3,54 Rehoboth 3,65 3,69 3,58 Mariental 3,63 3,67 3,55 Keetmanshoop 3,68 3,72 3,61 Luderitz 3,68 3,72 3,54 Source: Ministry of Mines and EnergyThis will be third fuel price reduction since July last year. Fuel prices fell by 10 cents a litre in July and by 20 cents in October last year. The prices are adjusted by Government every quarter. Thomas Mulunga, President of the Namibia Bus and Taxi Association (Nabta) said yesterday that his organisation would closely monitor the fuel price situation. Although a final decision would be made by the management committee, Mulunga did not think taxi or bus fares would rise in the near future unless petrol prices did. “If we see the trend [of fuel prices falling] is long-term, and not just for three months, then we may bring prices [fares] down,” Mulunga said by telephone. Joel Hinaunye Eita, researcher at the Namibian Economic Policy Research Unit (Nepru), said it was “difficult to predict” how international oil prices would move, as they depended on political developments in the Middle East. As long as the situation in the oil rich region remained volatile, the oil price would be unstable, Eita said. But tomorrow’s decrease would nevertheless have a “positive impact on the cost of doing business,” as fuel was a major cost to businesses and consumers alike. In a press release announcing the fuel price cut, Mines and Energy Minister Nickey Iyambo said during the last three months of 2003, there has been an upward movement in crude oil prices, which increased from US$27 to US$30 per barrel. This was, however, offset by the strengthening Namibian dollar-US dollar exchange rate, which improved by 28 per cent last year. The fuel price cut should contribute to a relatively benign inflation outlook for 2004, Eita said. Provided the Namibian dollar, and the rand to which it is pegged, remained stable Namibians could expect a stable or declining inflation rate for much of this year, Eita said. Below is what fuel will cost (in N$) in some towns, with effect from Wednesday. Source: Ministry of Mines and Energy