Fuel price fears spark warnings

Analysts have warned against panic buying and illegal fuel storage in Namibia as global conflict threatens supply, raising prices, economic risks and concerns over safety and informal trading.

The warning comes amid a statement by International Energy Agency (IEA) executive director Fatih Birol, who says the world is facing “the greatest global energy security threat in history”.

Birol tells the BBC that governments should be more vocal about how energy is being used.

He advises governments to encourage public transport, car sharing and more working from home while saving petrol for essential uses.

Some measures to limit consumption introduced in other countries include shorter hours for schools and universities and limiting air travel for public officials.

Pakistan and the Philippines have introduced a four-day week for public servants.

Local experts caution that while pressure on the supply and price of fuel may continue to grow, panic buying and unsafe storage could create additional risks for households, communities and the wider economy.

The United States-Israel-Iran conflict has affected key shipping routes, principally including the Strait of Hormuz off the coast of Iran, through which about 20% of the world’s oil passes.

Political analyst Ndumba Kamwanyah says Namibia is highly exposed to global fuel shocks as it imports all its refined petroleum products.

“The conflict involving Iran will likely push Namibia’s fuel prices higher. We import all refined fuel, so any global disruption hits us directly,” Kamwanyah says.

He says rising fuel costs are expected to affect households and businesses through higher transport and food prices, as well as increased operating costs in sectors such as logistics and energy.

He says economic pressure may have an impact on consumers’ behaviour.

“Economic pressure can push people to stockpile fuel or sell it informally.

When prices rise fast and supply fears grow, informal markets tend to emerge,” he says.

Kamwanyah warns that such practices could create broader risks.

“Informal trading and unsafe storage increase fire hazards, environmental damage and tax losses.

It also distorts the market and weakens regulation, making the economy more unstable,” he says.

Political commentator Marius Kudumo echoes his sentiments.

“The possibility of fuel scarcity and increased prices is there,” he says.

Kudumo says fuel remains central to economic activity, with households and businesses relying on it for transport and production. He adds that any disruption is likely to affect economic growth.

“Household and business activities such as transportation of goods and manufacturing are dependent on fuel to run efficiently and effectively,” he says.

Kudumo says market conditions could lead to informal fuel trading if supply becomes constrained.

Informal fuel trading, commonly known as “ngungula”, is already an established practice in parts of Namibia, particularly along the northern border with Angola.

The practice involves fuel being smuggled from Angola and sold in containers to motorists at lower prices.

Authorities have previously warned that the trade leads to revenue losses, safety risks, and unfair competition for licensed fuel retailers.

Namibia’s Ministry of Industries, Mines and Energy says selling fuel without a licence remains illegal.

Executive director Moses Pakote says illegal fuel trading is a challenge, particularly along the Angolan border, and the ministry is working with law enforcement to address the issue.

Pakote says fuel storage is regulated, with limits set at 200 litres within local authority areas and 600 litres outside such areas without authorisation.

“No person can operate a retail outlet or conduct the business of a wholesaler, unless authorised to do so under a retail or wholesale licence,” he says.

The ministry was not clear what the penalties are for selling fuel illegally, saying this is dealt with by the law.

“Penalties are usually determined by the competent courts,” Pakote says.

Oshana police commissioner Naftal Sakaria, whose region deals with illegal fuel imports from Angola, confirmed that several convictions have been made for illegal fuel trading.

“It is one of the easier cases to investigate, usually prima facie. Prosecutions require overwhelming evidence such as confiscated fuel, money from the sale and empty containers,” Sakaria says.

He says the fines are usually around N$3 000 and if fuel is found in a vehicle, the vehicle is often confiscated.

SUGGESTIONS

* The IEA’s other suggestions for governments, businesses and individuals include:
*Giving private cars access to city centres on alternate days
*Efficient driving habits
*Switching to electric cooking
*Additional reporting by the BBC

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