Almost weekly, some changes occur for some goods or services in Zimbabwe. This is hardly surprising when you look at the current state of the economy. We are currently looking at an exchange rate that is approaching US$1: ZWL$1000. Lately, the ZWL$ was hard to come by due to the scramble by parents and guardians to pay exam fees. The parallel market was charging US$1 at around ZWL$750 or ZWL$850. This was for people looking for ZWL$ to pay exam fees at a government rate of US$1: ZWL$455. Interesting development but that will fizzle out or has already fizzled out.
Petroleum Prices – Effective From 27 July 2022
The new prices are as follows:
ZWL | US$ | |||
Diesel 50 (ZWL/Litre) | Blend E15 (ZWL/Litre) | Diesel 50 (US$/Litre) | Blend E15 (US$/Litre) | |
Maximum Prices | 727.69 | 667.43 | 1.76 | 1.61 |
The old prices were as follows:
ZWL | US$ | |||
Diesel 50 (ZWL/Litre) | Blend E15 (ZWL/Litre) | Diesel 50 (US$/Litre) | Blend E15 (US$/Litre) | |
Maximum Prices | 669.62 | 659.80 | 1.88 | 1.77 |
Magnitudes Of Change
ZWL | US$ | |||
Diesel 50 (ZWL/Litre) | Blend E15 (ZWL/Litre) | Diesel 50 (US$/Litre) | Blend E15 (US$/Litre) | |
Maximum Prices | +58.07 | +7.63 | -0.12 | -0.16 |
Blending Ratio Increased
ZERA also announced that the blending ratio had been increased from E15 to E20. This was a long time coming though. ZERA had a while back indicated that the blending ratio would get to E20 by the end of June. However, the blending ratio was increased from E10 to E15 and kept there for a while. I have covered some of the concerns on ethanol blending in previous articles. There is even speculation that saying it is E20 might not necessarily mean it is E20. It could be E50 and motorists will not be able to objectively tell.
There Is Nothing To Celebrate Here
The US dollar prices have once again gone down: the price of diesel per litre has gone down by US$0.12. The price of petrol per litre has gone down by US$0.16. On paper, this sounds great but as you will soon see, it means nothing at all.
This is not necessarily something to celebrate, let me explain.
ZERA always says, “Operators may sell the petroleum products below the prescribed prices depending on their trading advantages…” Being someone who closely follows these things I can tell you many fuel stations do not adhere to this. All along they have been charging way beyond the prescribed price caps. This means these latest fuel prices mean nothing at all.
I stay just outside Masvingo and I am still to find any fuel station that has been charging fuel in line with ZERA updates. Right now there is no fuel station I have seen charging the following per litre (i.e. the latest official prices:
Diesel – US$1.76 (or less)
Petrol – US$1.61 (or less)
This has always bothered me and I recently decided to reach out to ZERA. Their response was:
‘Clive Masarakufa, Kindly report the specific stations to Zimbabwe Energy Regulatory Authority – ZERA on WhatsApp line +263 772 161 966.’
This is something I am going to do by doing a sweep of fuel stations in and around Masvingo. I do feel though that it could be all fuel stations. I do not quite understand how ZERA cannot be aware of something that is happening on a grand scale. What is your experience like in your respective areas, kindly share in the comments below.
That is what you need to know regarding this latest fuel prices update. Kindly comment below, indicating what fuel price movements have been like in your area. It is not fair that a regulatory authority announces official price caps and they are ignored. In essence, it makes the announcement of price reviews mere formalities far removed from what is on the ground.
The article is impregnated with inaccuracies.
The fuel reduction where I live are real.
A reduction of 12c/ liter in fuel is massive, it cannot be alleged to be paper only.
What may not be known is how sustainable the reduction will be.
The challenge with public writers who are political party activists is that the public never get balanced reporting.
To attribute ZW$ shortage to exam fees payments is shallow analysis. Dig deeper to find the correct reason
Parallel market rates have never reached Z$1000. Its false. The resistance level currently is at Z$720.00 sliding down to ZW$680 to ZW$650.
It’s difficult to find any money changer with US$5.00 worth of ZW$.
I have not established what the cause may be. A combination of:
1. Fees payment
2. Gold coin purchases
3.effect of RBZ liquidity control measures
4.High interest rates
5. Renewed rally on some ZSE counters
and other factors may be at play. It will be interesting to observe the trends over the next 2 to 3 weeks.
Thank you for the lengthy feedback. Our coverage (for length reasons) is ongoing so consuming one article in isolation and assuming it covers all the factors would be unwise.
We have many times noted that the parallel market rate is not one centralised number but rather a range which includes many rates, including shop pricing (which is how many experience the rate) which has reached 1000.
The exam fees matter is the latest (at the time of writing) but not the only effect on the availability of Zimbabwean dollars. You correctly pointed out the other factors which we have covered here in previous business news coverage.
Finally, the significance of the 12 cents is felt if you are measuring in US dollars, those buying in our national currency and unit of account, saw no reduction.
The feedback is appreciated and we can assure that our writing is not influenced by political activism but rather by analysing what information we have about the news. It is difficult if not impossible to have all the information at all times.