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Namibia: Fuel Up Again
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The Namibian (Windhoek)
13 May 2008
Posted to the web 13 May 2008
Tonderai Katswara
FUEL prices will go up on Thursday - for the fourth time this year.
Petrol increases by 44 cents per litre while diesel goes up by a staggering 80 cents to end up costing more than N$10 a litre.
The latest increases come on the back of record international oil prices, which are currently hovering at around US$126 (N$970) per barrel.
This latest increase will compound the already desperate financial situation faced by many households, with food and electricity prices already wreaking havoc in the lives of nearly all Namibians.
"Yes, we have just heard from the Ministry of Mines and Energy.
These fuel prices will be in effect as of Thursday, May 15," a source in the industry told The Namibian yesterday.
The increase will see Walvis Bay pump prices at N$9,84 for a litre of diesel, N$8,50 for a litre of unleaded petrol and N$8,48 for lead-replacement petrol (LRP).
In Windhoek these prices will be: N$10,04 (diesel), N$8,70 (unleaded petrol) and N$8,68 (LRP); at Keetmanshoop: N$10,20 (diesel), N$8,86 (unleaded petrol) and N$8,84 (LRP); and Tsumeb: N$10,11 (diesel), N$8,76 (unleaded petrol) and N$8,74 (LRP).
The fuel industry expert would not speculate on where fuel prices could stand by the end of the year.
"Remember this is a problem affecting the whole world.
I can't just estimate what fuel will be costing by year-end.
Perceptions drive markets and we can't afford to speculate at this stage," said the source.
However, the Deputy Dean of Economics at the University of Namibia, Dr Omu Kakujaha-Matundu, did not mince his words when he predicted that consumers would have to tighten their belts even more.
"Life is now tough for everyone - not only the low-income earners but also the middle-income earners.
It's a pity the Government did not offer tax relief during its budget, yet it was apparent that life would only get tougher for the consumer this year," he said.
Kakujaha-Matundu added that as all major industries relied on fuel, the oil price surge would severely affect non-oil-producing countries like Namibia.
He explained that the increase of fuel prices was not only attributed to rising crude oil prices but also to a weaker local currency against the US dollar - which is the purchasing unit of oil.
According to analysts and oil experts, crude oil prices are expected to rise to shocking levels of US$200 per barrel.
The economist also explained that considering the current macro-economic environment, the Bank of Namibia would have no choice but to increase its bank rate.
The Namibian yesterday also learnt that the Office of the Prime Minister has set up a task force to come up with ways how the Government could assist low-income earners during these tough times.
Namibia Manufacturers Association (NMA) CEO Hennie Fourie said the fuel price increases were a blow to local manufacturers, as around 10 per cent of their revenue would have to cover fuel costs.
He said manufacturers transporting their goods around the country or across borders would be hard hit.
The fishing industry, which is one of Namibia's largest economic sectors and a major foreign currency earner, has already been affected by the surging cost of diesel.
Said Fourie: "The increases this year have had a significant impact on our members.
Producers can only survive either by cutting costs of by increasing the prices of their products, and these are both unfortunate circumstances.
There is no way we can benefit from a fuel price hike."
He added that some manufacturers were being forced to retrench or scale down operations, which would have a negative impact on the country's economic growth.
Ordinary working people seem to be at the end of their tether.
"What really can I say? 2008 is a year that is proving to be the most difficult year of my adult life.
Everything seems to be going up or wrong.
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Look at these food prices going up, natural disasters, Zimbabwe elections and even the Olympic torch is under siege.
This is terrifying.
What a nasty year," was how a 28-year-old Windhoeker, Naomi Nowases, summed it up.
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| Copyright © 2008 The Namibian. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections -- or for permission to republish or make other authorized use of this material, click here. | |||||||||||||||||||||||||||||
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