Fuel prices likely to go DOWN, not UP

INDICATIONS from the local oil industry are that fuel prices are unlikely to change this month.

But motorists could see the prices of petrol and diesel being adjusted downwards next month, an industry expert has said. Speaking to The Namibian yesterday on condition of anonymity, the source said statistics emanating from the sector this month were very positive, making a fuel price increase unlikely.He said factors such as the strength of the South African rand and Namibia dollar, crude oil prices which have remained low since the last quarter, and the oil industry’s books all looked favourable.”My gut feeling is that the Ministry [of Mines and Energy] will this month keep the fuel prices as they are currently while monitoring the situation …and maybe effect a price cut in February.”Namibians were relieved when a fuel price cut was announced last month, reducing Walvis Bay pump prices to N$6,04 for a litre of unleaded petrol, N$6,02 for a litre of lead-replacement petrol and N$6,08 for a litre of diesel.Local motorists this week became anxious after rumours of an impending fuel price hike in South Africa, from where Namibia imports most of its fuel.However, the oil industry source explained that due to the steeper price cuts announced in South Africa last year, the industry there was likely to be experiencing an under-recovery, which was not the case locally.He also advocated for openness from Government concerning fuel prices, saying if consumers were well informed about the factors that came into play when adjusting prices – such as oil prices, exchange rates, interest rates and shipping costs – then it would be easier for them to accept price hikes.Last year, Namibians were hit by five petrol price hikes in succession, with prices only dropping slightly in December.The Ministry of Mines and Energy attributed all the increases to the then high and volatile oil prices in the world market.Speaking to The Namibian yesterday on condition of anonymity, the source said statistics emanating from the sector this month were very positive, making a fuel price increase unlikely.He said factors such as the strength of the South African rand and Namibia dollar, crude oil prices which have remained low since the last quarter, and the oil industry’s books all looked favourable. “My gut feeling is that the Ministry [of Mines and Energy] will this month keep the fuel prices as they are currently while monitoring the situation …and maybe effect a price cut in February.”Namibians were relieved when a fuel price cut was announced last month, reducing Walvis Bay pump prices to N$6,04 for a litre of unleaded petrol, N$6,02 for a litre of lead-replacement petrol and N$6,08 for a litre of diesel.Local motorists this week became anxious after rumours of an impending fuel price hike in South Africa, from where Namibia imports most of its fuel.However, the oil industry source explained that due to the steeper price cuts announced in South Africa last year, the industry there was likely to be experiencing an under-recovery, which was not the case locally.He also advocated for openness from Government concerning fuel prices, saying if consumers were well informed about the factors that came into play when adjusting prices – such as oil prices, exchange rates, interest rates and shipping costs – then it would be easier for them to accept price hikes.Last year, Namibians were hit by five petrol price hikes in succession, with prices only dropping slightly in December.The Ministry of Mines and Energy attributed all the increases to the then high and volatile oil prices in the world market.