Fuel price drop offers a little breathing room

Fuel prices across Namibia dropped at midnight, with petrol now costing N$1 less per litre and both locally available diesel variants down by N$4 per litre.

Mines and energy minister Modestus Amutse on Wednesday said international oil markets softened in June as geopolitical tensions eased, “and crude oil flows through the Strait of Hormuz gradually showed prospects for a peaceful deal”.

“Brent crude oil prices declined significantly", he said, adding that the Namibia dollar strengthened against the United States dollar, contributing to lower fuel import costs.

Cumulatively, these developments led to over-recoveries of about 125 cents per litre for petrol, 490 cents per litre for diesel 50 ppm and slightly more than 496 cents per litre for diesel 10 ppm in June.

New pump prices at Walvis Bay are now set at N$22.48 per litre of petrol, N$24.26 per litre of diesel 50 ppm and N$24.36 per litre of diesel 10 ppm for July.

Meanwhile, government is introducing a coordinated fuel supply agreement from July to September, which is expected to provide significant benefits to Namibian consumers by ensuring that fuel imports are procured at the Basic Fuel Price (BFP) flat rate, without the additional import premiums that would ordinarily be charged above the BFP.

The premiums amounted to about N$300 million a month on average.

“By eliminating these premiums, the arrangement will help to contain fuel procurement costs, mitigate upward pressure on domestic fuel prices, and protect consumers from unnecessary price increases during the implementation period,” Amutse said.