Fuel Price to Remain Unchanged for May

The Ministry of Mines and Energy has announced that fuel pump prices for the month of May will remain unchanged. This is partly as a result of the value of the South African rand against the US dollar and other factors that were minimal on petrol in terms of under-recoveries, and favourable on diesel, which pulled through with substantial over-recoveries.

“The South African rand, to which the dollar is pegged, had still been under pressure in April, seen breaching the key N$10.60 mark against the US dollar, in which crude oil is priced. The mark is, however, favourable compared to the previous month,” noted Minister of Mines, Isak Katali, is a statement released late last week.

Katali also noted that the month of April started off with low prices of crude per barrel, last seen last year owing to poor manufacturing data from China and Europe. However, as political tensions intensified between Russia and Ukraine, Brent crude climbed above US$106 per barrel amidst concerns over escalating tensions in Russia, which is one of the world’s major oil producers.

Katali stated that in Libya, the western Zawiya oil port was operating normally after protestors vacated the entrance, a situation that halted oil production in that country during the past month. “Despite these positive developments, the production of oil in that country still remains low and that underpins crude oil prices,” said the minister, adding that in Nigeria a bomb explosion in a bus station on the outskirts of Abuja caused a nagging fear about the spread of violent attacks, which could consequently disrupt oil supply.

Katali cautioned that the global market was still volatile and said his ministry would keep a “watchful” eye by ensuring that it was in a position to subsidize fuel pump prices in trying times.

The Ministry of Mines and Energy is embarking on a fuel-marking project, which aims to authenticate fuel coming into the country for domestic consumption and fuel in transit to neighbouring countries. Through this project the ministry also seeks to verify actual volumes of fuel sold for domestic consumption, from which levies are collected, against volumes imported from which customs and excise duties are collected.

Source : New Era