Fuel prices to go up?

The price of fuel is set to go up following recommendations by a consultant that retail fuel operators should get an additional two cents on the profit margin.

BY TATIRA ZWINOIRA

Delegates follow proceedings at the Zimbabwe Energy Regulatory Authority petroleum sector pricing study stakeholders’ workshop which was held at the Harare International Conference Centre yesterday

Delegates follow proceedings at the Zimbabwe Energy Regulatory Authority petroleum sector pricing study stakeholders’ workshop which was held at the Harare International Conference Centre yesterday

The Zimbabwe Energy Regulatory Authority’s (Zera) stipulated retail fuel operator profit margin is $0,06.

As of yesterday, the prices of petrol and diesel were at an average of $1,33 and $1,18 per litre respectively, according to consultants Genesis Analytics hired by Zera to do an analysis of fuel pricing.

If the recommendation is taken on board, the price of fuel would rise to $1,35 and $1,20 per litre for petrol and diesel respectively a situation that would trigger a general increase in prices in the economy.

Addressing guests at the Petroleum Sector Pricing Study Stakeholder Workshop yesterday in Harare, Genesis Analytics representative in charge of the study Ethel Teljeur said part of the problem was a lag in the free on board cost to the final pump price.

“…the only model we found can work here is a fixed price setup to offshoot the lag in time it takes between FOB and the actual pump price,” Teljeur said.

The study found there was an average two week’s delay in considering changes to the free on board cost on the international market to the final pump price.

Genesis Analytics found the country’s fuel cost build up to be the most expensive in the region, which forced retail fuel operators to operate at low profit margins.

In comparative countries, Tanzania’s retail fuel profit margin is about the same as in Zimbabwe, Zambia is 4% per litre of petroleum, Namibia (9%), and South Africa (12%).

The difference between these countries and Zimbabwe is that they are able to subsidise, unlike in the country which depends a lot more on petroleum as a major revenue contributor.

Taxes and levies take up $0,461 and $0,632 for diesel and petrol respectively. With the country consuming 4 million litres a day, according to estimates, government makes an estimated $2,18 million per day.

However, permanent secretary in the Energy and Power Development secretary Patson Mbiriri said during the data collection exercise, some of the stakeholders had inflated the data hoping to influence results of the study in their favour.

In September 2015, Genesis Analytics undertook the study which ended last week of October this year. The study was supposed to investigate why Zimbabwe has the most expensive fuel prices in the region, despite a fall in the global price of crude oil.

In the first round of the study, only 39 responded out of 491 licensed fuel retailers. In the second round, 184 licensees out of the 491 participated.

In total, only 45 licensees out of 491 provided usable information, Teljeur said.

“This means we had a sample size of less than 10% and that might be okay if the selection process had been followed in finding these respondents. This is why we really want to make it very clear that the findings are not very definitive at this stage,” she said.

Consumer Council of Zimbabwe deputy executive director Rosemary Mpofu said consumers could not afford any fuel hike and that Zera had to stamp its authority as fuel operators were using the high fuel cost build up to take advantage of consumers.

20 Responses to Fuel prices to go up?

  1. Pumpkin November 4, 2016 at 7:54 am #

    That’s why I always say amaNDEBELEE are wicked

    • Roving Eagle November 6, 2016 at 6:53 pm #

      Stop and go driving due to numerous roadblocks is costing the country more on the fuel import bill than the bribes and toll fees collected.

  2. Zimbabwean November 4, 2016 at 7:55 am #

    This is just daylight robbery the rich are getting richer taking advantage of the absence of law, South Africa sales at 89-90 cent petrol the difference of 46 cents per litre is no joke. Zimbabweans need think who will this affect defiantly not the Captains of industry because their profits go up and us the ordinary Zimbabweans suffer. Love your country and countrymen before huge profits we are all trying to survive, soon the little guy wont be able to buy your product because you have left nothing in his/her pocket just as now its not easy for the little guy to get US dollar.

  3. tshuks November 4, 2016 at 9:14 am #

    Zera are clueless and full of bullshittttttttt. This economy is already suffering and how can they allow only one research team to carry out such a study. Fuel in Zim is expensive and you seem to be content with dat I wonder whether we are EVER going to see any government institution contributing meaningful in the revival of this economy or they are only concerned with collection of money.

  4. moyo November 4, 2016 at 9:21 am #

    Let us have the opinions of 2 more consultants.We cannot rely on the opinion of one consultant whose opinion sounds very strange to me.

  5. Ndega Zvangu Ufunge November 4, 2016 at 9:36 am #

    In Botswana (as I write), a liter of petrol is P7.00 which generally translates to US0.70/liter. Botswana does not have any oil field that I know.

  6. ndoro November 4, 2016 at 9:48 am #

    I dont know if there is need for Zim to spend the scarce resources on doing such a research because to me the reasons why fuel is expensive look obvious. The government is levying a lot of taxes on fuel instead of subsidising in a way. A friend in Mozambique told me petrol cost around 0.65 cents of a dollar and diesel 0.60 cents. If you are to buy 20 litres of petrol in Mozambique today you will spend 13 dollars while in Zim you need 27 dollars for the same quantity imagine.

  7. Mandi Chimene November 4, 2016 at 10:20 am #

    usnsnnb ns lm!

  8. chapwati November 4, 2016 at 10:59 am #

    In Mutare black market fuel is going for $1, after purchasing it in Mozambique Manica for $0.50 a litre.

  9. Moyo November 4, 2016 at 11:40 am #

    But can the details be availed. We are currently getting E5 and E10 from the pump at that cost. Are we saying the prices for these blends are the same for standard Blend and Unblended fuel. Why is this being left unchecked?????????????

    Somebody please explain.

  10. #THISFUELMUST FALL November 4, 2016 at 12:03 pm #

    Zambia petrol is $0.92 per litre . Its still there since August 2015. Only in Zimbabwe where they think of inflating prices at the expense of the poor.

  11. Cde Hasha November 4, 2016 at 12:08 pm #

    Stupid satanic, Lunatic corrupt ZERA.

  12. Martin Mukaronda November 4, 2016 at 1:48 pm #

    This is booo shit what Munangagwa is saying. I am the Assistant Director of Marketing and Communications at Zimbabwe National Family Planning Council (ZNFPC). Whether your prices are up or not we get our fuel from Donor agency and other partners. I still get my fuel from UNFPA and my salary will be coming from them soon.

  13. makwinja November 4, 2016 at 2:27 pm #

    The greatest cost component of fuel is duty: Petrol USD0.67; Diesel: USD.46

  14. J November 4, 2016 at 3:10 pm #

    This will not stop the old man from flying to Singapore and everywhere like a fly perhaps this is another way to pay for his fuel to Singapore

  15. Nane November 4, 2016 at 3:13 pm #

    So if fuel prices go up everything will go up simple as that
    Well done Banana republic keep it up

  16. zai November 4, 2016 at 5:08 pm #

    Why not stop using the trucks for ferrying the fuel from Beira & revert to the pipeline instead? And which stupid fuel seller would suggest & support a reduction in their profits? Obviously none! This research shld be for non-fuel dealers. By the way, didn’t Zimdef fund this research too?

  17. Makwarimba November 4, 2016 at 9:22 pm #

    In Mutare we dont care!!!!!!!!!!!!!!!!!!!!! 🙂 🙂 🙂 yedu fuel tinoiwana mahara yepaMoza
    Ende Ose maService station ava Matongo MaMutare!!!!! KKKKKKKKKKKK maKuvara guys

  18. prof moyo WeZacc November 4, 2016 at 9:27 pm #

    how is this ethanol thing helping us, i wonder

  19. gunguwo November 8, 2016 at 12:46 pm #

    Zimbabwe is a mystery that only the leaders understand. We have E5, E10 and E15 but we have the most expensive fuel in the region, why? Someone feeds off the suffering of the ordinary man, as always.

    Just the same with interest rates. Why are Zimbabwean loans from banks as expensive as 18% p.a. Asi chiiko nesu nhai? Ndookudzidza kwacho kwekungofunga kudyanana chete?

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