ZERA Marginally Reviews Fuel Prices

ZERA has once again reviewed fuel prices for diesel and petrol effective the 6^th of May 2022. The previous fuel prices review was about 2 weeks ago. Interestingly, this time around the change is marginal. In US dollars, the price for diesel remains the same. In US dollars, the price of petrol increased by a very tiny margin. In Zimbabwe dollars, the prices marginally increased for both diesel and petrol. LPG prices effective May 2022 were also announced. It will now cost US$2.24 or ZWL$371.81 per kilogram.

Seems Service Stations Can Charge Whatever They Want

I must mention that there is a trend I keep observing. ZERA always says, ‘operators may sell the petroleum products below the prescribed prices depending on their trading advantages…’ Yet I am always seeing service stations charging above the prescribed prices. Why is it there is no enforcement to ensure they do not charge above the price caps?

Petroleum Prices – May 2022

ZERA has advised that there has been a review of prices for diesel and blend with effect from 6 May 2022. The new prices are as follows:

New

Previous

Change

ZERA Says Blending Reduces Fuel Prices

The fuel prices update towards the end of April saw the return of petrol blending. It was not quite clear why ZERA enacted something they had scrapped before. ZERA has since said that the blending was and is meant to reduce the price of petrol. They said that if they had not reintroduced blending, the price could have been much higher. Regardless, it is still crazy to think that the price is still sky-high when you look around other countries in our region or Africa as a whole. Our fuel prices are higher than those in Zambia, Botswana, Lesotho, Swaziland, South Africa, Mozambique, and Namibia, amongst others. Frankly speaking, I do not think it is about the blending issue. The fuel prices in Zimbabwe are too high because of taxation – hefty tariffs on the fuel value chains.

Some Fuel Stations To Sell Fuel In RTGS

It has since been reported that 57 fuel stations have been picked for this facility. This was revealed on the 5^th of May by the Deputy Minister, Energy and Power Development, Magna Mudyiwa. Here were some of their remarks:

“It is not all service stations which are selling fuel in RTGS but there are some service stations which are selling in RTGS through the fuel for RTGS is very limited. We have selected 57 service stations with ZERA and National Oil Infrastructure Company (NOIC) working together with the Reserve Bank of Zimbabwe (RBZ) under the Ministry so that these 57 selected service stations sell their fuel in local currency.

The service stations must meet other conditions which ensure that the fuel is monitored. To date, we are not able to get fuel to deliver to all these 57 service stations. That is why you assume that there are no such service stations. There is little fuel found and sold in local currency. These service stations which sell fuel in local currency must be monitored by the National Fuel Management System which is a computerised system and monitors how many litres of fuel have been received and the levels must be monitored from a remote-controlled office.”

The option for people to purchase fuel in RTGS would be most welcome. Most people do get their incomes in RTGS and it would be reasonable since interbank rates would be used. The only problem is, as already cited; that the government is failing to deliver fuel to all those 57 service stations. After all, 57 service stations for the whole of Zimbabwe are just not enough. They are not enough to practically say there is RTGS fuel available. It seems strange how the government is pushing for widespread use of the Zimbabwe dollar yet fuel is still mostly sold in US dollars. It is always ironic when you notice all these policy inconsistencies. Interestingly though, I am yet to come across the full list of the 57 RTGS fuel service stations.

So that is the latest on fuel prices in Zimbabwe right now. It would be interesting to see what happens the next time a fuel prices review comes. It would also be interesting to see how sooner or later it is going to come.