27 Mar 2015 13:00pm
CORRECTION: REPLACE 'litter' WITH 'litre' IN THIRD PARA
WINDHOEK, 27 MAR (NAMPA) -Motorists will have to dig deeper into their pockets when fuel prices and the Road Fund Administration (RFA) levy increase next week Wednesday.
The prices of fuel will increase on 01 April at 00h01, Mines and Energy Minister Obed Kandjoze announced in a media statement issued here on Friday.
The statement said 95 Octane Unleaded Petrol will increase by 50 cents per litre at retail, then costing N.dollars 9.99 per litre, Diesel 500 parts per million (ppm) will increase by 40 cents per litre at wholesale, then costing N.dollars 10,12 per litre and Diesel 50ppm will increase by 40 cents per litre, then costing N.dollars 10.22 per litre.
Earlier this month, 95 Octane Unleaded Petrol stood at N.dollars 9,59 per litre countrywide, while Diesel 500 parts per million (ppm) stood at N.dollars 9,82 and Diesel 50ppm at N.dollars 9.92 per litre.
The Minister added that the RFA levy will be adjusted by 10 cents per litre on the prices of 95 Octane Unleaded Petrol and all grades of diesel.
He explained that the under-recoveries per product on the Basic Fuel Price (BFP) import parity landed in Walvis Bay was calculated at 77.021 cents per litre on 95 Octane Unleaded Petrol; 54.579 cents per litre on Diesel 500ppm and 50.479 cents per litre on Diesel 50ppm at 23 March 2015.
The Minister said, Cabinet last month requested his ministry to adjust the RFA levy by 10 per cent when it is suitable.
Despite the Unit Under Recoveries for March 2015, Kandjoze said the ministry took a fair decision to pass on the cost of maintaining a good road network in Namibia to the consumers.
Kandjoze noted that oil commodities are traded in US dollars on the international market, meaning that Namibian oil imports require on average an extra N.dollars 6.66 for one US dollar in the process of financing the importation of oil commodities.
This translates that the cost of doing business went up and hence the Basic Fuel Price (BFP) recorded substantial Unit Under Recoveries, he said.
The minister said since oil commodities need to be shipped to the Namibian shore by oil tankers, the costs at which these commodities are shipped is also affected by the exchange rate.
He explained, this means that shipping costs have also increased and have also contributed to the Unit Under Recoveries recorded over March 2015.
Kandjoze noted that his ministry expects the US dollar/Namibian dollar exchange rate to stabilise in the future in order to keep the oil prices as low as possible.