The Energy Regulations Board has determined that there will be no adjustment of fuel prices in December 2018.
ERB Board Chairperson Raymond Mpundu said the pump prices per litre for petroleum products will remain at K16, 06 per liter for petrol, K14, 65 per liter for Diesel, K11, 34 per liter for Kerosene and K16.94 per liter for Low Sulphur Gas.
Mr. Mpundu said Fuel prices in Zambia are largely determined on the basis of two factors namely international oil prices and the exchange rate of the Zambian Kwacha against the United States Dollar.
He said in Zambia, the Energy Regulation Board uses the Cost-Plus Model to determine wholesale and pump prices and these prices are reviewed only after each importation has been fully consumed.
“In November 2018, the Government of the Republic of Zambia imported 100,000 metric tons of petroleum feedstock cargo, at a total cost of US$74.40 million. In addition, Government imported finished petroleum products amounting to 29,569.69 metric tons and diesel amounting to 71,461.48 metric tons, at a total cost of US$77.88 million”, He said.
He said during the period of importation, in mid-November 2018, the Kwacha was still depreciating while international oil prices were still relatively high.
Mr. Mpundu however said beyond the period of importation, there was a slight appreciation of the Kwacha and a notable drop in international oil prices that they had and no fuel was imported.
He said the general fall in international oil prices in the period under review was mainly attributed to the excess oil supply and high oil inventories.
Mr. Mpundu said oil prices have however remained unpredictable and are on the upward trend.
“Since the importation was done at the time when the two fundamentals that determine fuel pricing were still unfavourable, the notable improvement, thereafter, could not influence a price reduction.
The Zambian government was wise to not reduce prices. OPEC already sat down to cut oil production beginning January. So expect prices to start soaring again.
Meanwhile when international oil price goes up ERB hike the price within 24hours without taking into consideration of the fundamentals. These guys are fake and this is the board that Sata during his compains said he’d disolve first. Wonder what ecl is waiting for.
Yellow Vests in FR reacted to higher fuel prices, Macrone was made to listen.
When prices are on the downtrend, the ERB takes some to “observe” the prices for any unpredictable trends and will REDUCE THE PRICE, BUT when the prices are on the upward trend ERB is quick to hike the price.
So prices change when they are on the hiking side, that the message this fuul is telling you.
correction.
…..the ERB takes some to “observe” the prices for any unpredictable trends and will NOT REDUCE THE PRICE,
Mpundu’s explanation is very unsatisfactory. We are running a country for crying out loud. And yet the most strategic economic driver is being bought and sold as if we are dealing in cabbages at Chisokone!!!
Seriously????!!!!! We need strategic planning when it comes to strategic economic drivers and that’s how we remain viable. I have said it before and I will say it again.
Under UNIP we always used strategic reserve planning for all strategic economic drivers and that’s why we had futures contracts with Kuwait for up to 5 years in certain cases.
Mpundu’s board needs to be dissolved and replaced with a new one that understands these things. How can you run a strategic installation like ERZ like a Salaula Stand???
Heaven help us all …
In fact this is the best time to lock in futures contracts for the next 5 years. Imagine maintaining the same prices for 5 years at a lower rate.
Those savings are passed on to the consumers who in case of individuals have more purchasing power as their discretionary income increases and for companies, they can now increase production or introduce new products on the market.
The economic benefits are huge when strategic planning is applied to strategic economic drivers. Everyone benefits.
Heaven help us all …
Let’s wait and see chances are fuel prices will continue to drop on the international market as less vehicles tend to move around during winter in Europe and North America resulting in even less demand so those predicting the prices to go up know nothing about price forecasting.
Why not innovate an alternative fuel source? We have brilliant minds, let’s save our future.
A good and progressive thought. If we had more minds like yours, we would not alway be lagging behind and resigned to fate as in this case. More and more European and also Asian countries are already adjusting from fuel to electric battery vehicles.
This is just another story to screw the people, we just go a decrease and another one has been forecast for January, you are telling me fuel in Zambia is sold at such a slow pace, something fishy here
You are right, fuel here has been reduced twice already, yet my brothers and sisters pay Zed are still paying high prices, this fish stinks!
The Fuel Spokespeople have spoken! Do we really need to spend Tax money on these guys? Why not put this ERB function under Ministry of Energy? Or is ERB part of GRZ Job creation strategy? To be honest, I don’t see the relevance of ERB to the Fuel equation! Just disband the thing! Or give it to the Chinese who are said to be as resilient as Cochroaches maybe they can help us with resiliently lower Fuel costs! The so called Zambian experts are nothing but Kleptomaniacs only concerned with feathering their own nests! Black munthu te munthu! What good can come out of black munthu?
In November you bought fuel before the drop in world prices, now for December’s purchase with prices low , and the kwacha the same price as in November, Zambia expects a drop in fuel prices for the cargo bought in December …..
These are not leaders, there business men for god sake. These gods of society are so greedy.
What’s the purpose of this statement you manguam? Just shut your trap instead of insulting our intelligence.
Our fuel is cheaper than in South Africa.
Zambians should be proactive like France. That is the only language a politician can understand. Hiding behind social media to express your resentment will not solve anything. Taxes are only benefiting these ministers. You go to a hospital there are no drugs. There is no breathing space for a Zambian worker. Every dime he or she gets is choked by slavery taxes. Docility is the worst enemy of the nation. France has made President Macron to realize that power comes from the people. Politicians are hoodwinks who should not be trusted. The only language they understand is revolution. Otherwise, these politicians are all the same. They are all cut from the same cloth of deception.
On Dec 14, 10:59 AM CST, Crude Oil traded 3% lower than previous day’s close. This has occured 26 times over the last 12 months.
12 out of those 26 times, the price had increased one hour later. The average increase was 0.27 points and the maximum increase was 0.58 points.
14 times, the price decreased one hour later. The average decrease was -0.50 points and the largest decrease was -1.06 points
He is correct in his statement but then given the economics in the oil supply The price of oils would likely trade in the range of USD 60 to USD 70 per Barrel if you analyse the futures on oil (Brent or WTI) balance sheets for period 2019 to 2020
So in as much as the statement is correct that oil prices are showing some contagion because of managed supplies(not market settlements),We expect in the background ERB to hedge and at least pass on those savings in prices locked in future resourcing to its consumers marginally Though taking the market and not doing anything on the price up ward trend is a strategy,it may not work this time as “active” price forecast…
just assuming one can bit the market, will be very important in savings and managing to avoid 2019 to 2020 future price increases Those who will resource and profit on price movement need not simply take the prices as they move They will need to use insights and hedge
Whatever you id.ots at ERB are saying does not make any single sense in anyones thinking. You are just big i.diots reaping where you did not even sow ‘ m******mwe!!!!
Oil all over the world is going down and there some countries where their currency is even in more pressure than ours and they are still reducing their fuel prices. Mwabe tweno!!!! Dont insult our intelligence just because you cannot think beyond your stu.pidy backholes.
You can advance your reasoning basis why you think the differently the terminal prices from ERB without insulting
Otherwise we stop contributing our thinking
Mr Mpundu change cost model to average cost model because finished products are separated
He can use that to read and understand the Price Momentum but he cannot predict the price accurately and by Nature Technical Analysis of the Averages in oil prices is skewed with lot of lagging indicators
He can have a simple or exponential but Technical Analysis in this will not help much to set the accurate market price
His current pricing is within the average movements added to it is the fundamental reasoning behind the movement in the Prices Prices in themselves are only part of the determination He has to read and forecast the FUTURES in prices for long-term and hedge to pass on to the Zambian consumers
With this i close all my contributions…
Does Govt buy oil directly or it is through middle men?
Why is it that fuel prices in Zambia is highest among other African states?
Please remove middle men in the purchase of oil and these prices that keep on fluctuating and affecting our engine of production to reduce. The cost of living is too high for ordinary Zambians
i think there hasn’t been much effort in dealing with thus problem, because it is business as usual to some individuals.
PLEASE MAKE ZAMBIA GREAT AGAIN
ERB is just a rubber stamp. They have no independent power to increase or reduce prices without government approval so let’s just dissolve this body, save money and leave such function to official government spokesperson or the minister of energy.
Kutumpa saana as if pali na education bakwata useless God will deal with you unless his dead.