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‘Fuel price decline should cascade downstream’

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THE decline in fuel prices effective today will result in the price of consumer goods going down since it is one of the biggest cost drivers, the Consumer Council of Zimbabwe (CCZ) has said.

TARISAI MANDIZHA
BUSINESS REPORTER

Last week, the government gave fuel industry players a directive to reduce prices by $0,20 to $1,20 and $1,32 per litre for diesel and petrol respectively in line with a marked decline of oil on the international market.

CCZ executive director Rosemary Siyachitema said the reduction in fuel prices should cascade down to all other commodities.
“It is about time, we are some of the people who were pushing since the tumble of fuel on the international market and this means if the prices have tumbled it should decline to all consumers,” Siyachitema said.

“We said fuel needs to come down as fuel is a cost driver and it means other prices in the supermarkets should come down as well and we are waiting for it to happen.”
Some retailers in the central business district have already started reducing prices.
A snap survey by NewsDay yesterday showed that some service stations were already trading at the new rates while others have promised to change the prices today.

The price of crude oil on the international market has been on a free-fall since June last year from around $118 to about $45 per barrel yesterday.
In June 2014 the freight-on-board (FOB) prices at Beira were at $0,88 per litre for diesel and $0,86 per litre of petrol. These have since gone down to $0,57 and $0,52 per litre respectively as at end of December 2014.

Meanwhile, CCZ said the prices of most consumer goods remained high during the first 10 months of 2014 although price decreases were witnessed through various promotions run by some retail outlets countrywide.
Statistics from the CCZ show that the basket for a family of six soared between $550 and $590 during the period January to October.

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