Windhoek-The price of fuel in the country decreases by 50 cents this week, the mines and energy ministry announced on Friday. The decrease is because of a favourable exchange rate between the Namibian dollar and the US dollar, and because of the prices of crude and refined oil that remained below the earlier projections of higher prices during June.
The decrease, effective July 5, is for both petrol and diesel with the new Walvis Bay pump prices now going to be N$10.50 per litre for 95 octane unleaded petrol, N$10.33 per litre for diesel 500ppm and N$10.38 per litre for diesel 50 ppm.
“For the past few months consumers have not gotten a relief at the pumps because the results of the basic fuel price model were not favourable. It is only fair that they get some relief this time around when the conditions are favourable,” said the Minister of Mines and Energy Obeth Kandjoze in the statement announcing the price decreases.
According to Kandjoze the weaker US dollar, for which the exchange rate was at N$12.88 in June, having dropped from the average of N$13.22 in May, meant that the country was able to import oil in the country at cheaper prices compared to what the country paid in May. In addition to that were the cheaper costs for shipping oil tankers during June, with prices at US$145.7 per metric tonne compared to the price of US$151.30 in May.
This enabled Namibia to save money from every litre it bought during the month of June. The mines and energy ministry says for every litre of fuel that landed at the port Walvis Bay, it was able to save more than 50 cents which was put away in the energy fund.
According to Kandjoze the savings were 60.234 cents per litre of 95 octane unleaded petrol, 58.164 cents per litre on diesel 500ppm and 59.536 cents per litre on diesel 50 ppm.
The price of crude oil and refined oil turned out to be much lower in June than the prediction made earlier, which were based on the OPEC agreement to cut oil production.
The expectations were that by June, the prices would be hovering above US$65 per barrel.
Yet for the past four months, the prices have not reached that threshold with June recording US$60 for a barrel of refined diesel and US$57 for a barrel petrol. These averages are not far from the preceding month’s averages of US$63 per barrel for refined diesel and US$60 for petrol.