‘No escape from wrath of fuel price hikes’

GOVERNMENT has spent nearly N$72 million in April so far to cushion consumers against spiralling fuel prices.

The N$71,7 million is more than a quarter of what Government spent the entire 2011-12 financial year in fuel subsidies, Mines and Energy Minister Isak Katali said in reaction to the petrol and diesel price increases which came into effect at midnight. Petrol went up by 20 cents a litre and diesel by ten cents a litre.The price of 95 Octane has risen 69 cents per litre so far this year, while 93 Octane has increased by 70 cents a litre. Diesel has become 21 cents a litre more expensive. Over the past year, the petrol price has increased by about 16 per cent, while diesel has gone up around 12 per cent.Katali said in a statement fuel prices are ‘low’ and warned consumers to be ‘cautious’ as ‘Namibia cannot escape the wrath of continuous fuel price increases’.Katali said at the end of March the under-recovery on 93 Octane was 36,9 cents per litre, on 95 Octane 37,9 cents per litre and on diesel 15,5 cents per litre. An under-recovery is when the price of imported fuel is higher than the selling price locally.’Efforts were made for the past months not to pass the whole burden to consumers, thus a certain portion of the increasing under-recoveries were carried by the National Energy Fund (NEF),’ Katali said.The fund will also ‘meet the consumer half way by subsidising the current under-recoveries by 18 cents on petrol grades and eight cents on diesel respectively’, he said.As from today, 95 Octane Unleaded petrol costs N$10,03 per litre at Walvis Bay, while 93 Octane Lead Replacement Petrol costs N$9,97 a litre and diesel N$10,35 a litre.In Windhoek, 95 Octane costs N$10,25 a litre, while 93 Octane costs N$10,19 a litre and diesel N$10,58 a litre. In Gauteng, 95 Octane sells for R11,94 a litre, 93 Octane for R11,77 and diesel for R10,88.Katali said ‘it seems unlikely that the current rise in oil prices is a result of high demand’. Analysts believe current conflicts in the Middle East, the US and UN sanctions imposed on Iran’s nuclear strategies are the most likely cause, he said.