Fuel price to drop on Wednesday

01 Jun 2013 08:30
WINDHOEK, 01 JUN (NAMPA) - The price of fuel will decrease on Wednesday next week.
Mines and Energy Minister Isak Katali announced this in media statement issued here on Friday.
95 Octane Unleaded Petrol will decrease by 20 cents per litre (retail) to cost N.dollars 10,65 per litre, while diesel will decrease by 15 cents per litre to cost N.dollars 10.91 per litre.
Katali said 93 Octane Lead Replacement Petrol (LRP) will remain unchanged as it is phasing out.
Last month, 93 LRP decreased by 30 cents per litre (retail) to the cost of N.dollars 10.74 per litre.
?As summer approaches in countries with enormous appetite for oil, global aggregate demand for the commodity falls, there by stabilising the oil market in the Asian countries especially,? said Katali.
He added that the second largest consumer of oil, China, has also seen in recent days a slow growth in their manufacturing base.
This reduced China?s use of oil in May, and her demand fell significantly.
?It is now well understood that the average price per barrel is the largest component in the local pricing system, and when it falls, as it did in May, expectations are that the local oil market will pull through that particular month with an over-recovery,? explained Katali.
He further noted that the exchange rate between the Namibian dollar against the United States? (US) dollar is still weak, and it hovered close to N.dollars 9.20 throughout May.
?It is for this reason that the local market recorded substantial over-recoveries to trigger a reduction in the current pump prices,? he said.
The minister said the oil market remains volatile, and his ministry is monitoring the situation to ensure that the market is shielded from distortion by any oil price shock.