8th fuel price increase for 2021
29 November 2021 | Economics
With few days left before the festive season, motorists will have to dig deeper in their pockets as they plan their holidays.
On Friday, the Ministry of Mines and Energy announced that both the price of petrol and diesel will increase by 70 cents per litre(c/l), effective 1 December 2021. This will be the eighth (8th) fuel price increase for 2021.
The adjustment will bring the total fuel price increases for 2021 to N$4.30/l for petrol and N$4.20/l for diesel. Earlier this month, the price of petrol increased by 50 c/l, while diesel increased 70c/l.
The transport category, which captures fuel, has the third largest weight of 14.28 points out of 100 in the Namibia Statistics Agency (NSA) consumer basket. That implies that, on average, for that N$100 that consumers have in the pockets, N$14.28 is likely to be spend on transport.
According to the ministry’s spokesperson, Andreas Simon, after a series of the Organization of the Petroleum Exporting Countries (OPEC's) meetings, members have still not agreed to increase supply into the market owing to prospects of surging Covid-19 cases which will depress demand.
As a result, global oil prices remain high, although they fell slightly during the period under review. Refined petrol remains high, trading at an average of US$94 in November whereas diesel traded at an average of US$92, he pointed out.
Furthermore, the local currency depreciated slightly against the United States (US) dollar, from an average of N$14.85 in October to an average of N$15.35 in the period under review. Since fuel pump prices increased only minimally in November, in comparison to the under-recoveries recorded, the depreciation pushed up the under-recoveries brought forward from the previous month, Simon said.
The petrol pump prices in Walvis Bay, which is the port of entry, will become N$15.65 c/l and diesel price will become N$15.58 c/l. Diesel will be up by nearly 37% from N$11.38/l last December.