No changes expected in fuel prices, says Ministry of Energy

Minister of Energy, Ibrahim Matola, has disclosed that fuel prices will not be increased this month because international oil prices have remained constant for the past two months.

The minister has also said the incorporation of a vehicle licence levy on the fuel price build-up will be absorbed within the existing cost of fuel and will not result into an adjustment of the prices.

He said following a meeting of the fuel pricing committee at the Malawi Energy Regulatory Authority (Mera) on Tuesday last week, government has been informed that there will be no change in the prices for the second month running.

“I got a report that the prices will remain the same even though vehicle licence fees have also been moved to fuel pump price. Apart from that, I was also informed that on the international market, prices have not changed,” said Matola in an interview on Wednesday.

Matola assured the public that government is doing all it can to maintain constant supply of fuel into the country.

He said apart from fuel supplies Malawi is receiving from Zimbabwe as part of the 2007 maize purchase loan re-payment deal, the country was also receiving fuel imports from its usual suppliers.

“Zimbabwe is paying back a loan and there are speculations that the country might run dry again as supplies from Zimbabwe have run out. We still have supplies from our usual suppliers and this will go on the way as it was. There is nothing to worry about,” he said.

Government through Mera last increased the price of fuel on November 9, 2012 by 12 and 14 percent respectively for petrol and diesel.

Petrol is now selling at K606 per litre from K539 while diesel is at K597.40 per litre from K521.90 per litre.

In July last year, the government adopted an Automatic Pricing Mechanism (APM) under which prices of fuel are increased or reduced whenever landing costs, usually driven by international oil prices and the exchange rate, change by five percent.

The policy is aimed at encouraging fuel importing companies to meet the demand based on market shares and the mandatory stock holding requirements.

Since the APM was introduced, fuel price, have been changing every month and in October fuel prices went up by 7 percent.

Meanwhile, Matola has warned motorists against buying of fuel from the black market, saying such fuel has the potential to damage vehicles.

“The people on the black market are hoarding fuel in anticipation that fuel pumps will be dry. Now they want to dispose it of but at the same time they do not want to make a loss hence they might be adding other elements to the fuel which in turn can damage vehicles,” he said.