Fuel gone up

Prices of fuel have gone up by an average of 32 cents per litre this week. The announcement by the Ministry on Mines and Energy came into effect midnight on Wednesday.
The main driver was cited as increased demand in oil as various countries continue to boost their economic activity through economic expansion such as road and bridge construction, fuelling agricultural machines and mining activities. This has become especially true for the two countries with the largest appetite for oil namely China and the USA. The market of Namibia’s main supplier of oil (Asia) saw prices of crude oil well above US$130 per barrel during the month of February which was indicative of the growing rise in demand for oil.
In a statement made by the Minister of Mines and Energy the exchange rate is also fingered as a culprit. “The exchange rate between the Namibia dollar and the US dollar is still weak and it hovered close to N$ 8.90 throughout the period under review. It is for this reason that the local market pulled through with huge under-recoveries at the end of February, half of which were passed on to the consumers in order to recover the costs incurred. The remaining half will be paid for by government through the National Energy Fund.” He explained that the National Energy Fund is employed to equalise fuel price movements and to subsidize under-recoveries.