Tuesday, March 5, 2024

Government to maintain monthly review of fuel pump prices

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Minister of Energy Eng. Peter Kapala says government will not revert to a quarterly review of fuel pump prices.

Eng. Kapala states this that the old system of adjusting fuel prices quarterly makes it difficult to manage the debts that government owes oil marketing companies.

Disclosing the matter on his Facebook page yesterday, the minister notes that the quarterly review of fuel pump prices does not make the pump price cost-reflective.

“We have no plans to revert to previous ways of adjusting fuel prices after months, as that makes it hard to manage the debts owed to oil marketing companies and doesn’t make the pump price to be cost-reflective,” Eng. Kapala said.

In January this year, the Energy Regulation Board (ERB) commenced the monthly pricing cycle of petroleum products.

And in March, the Minister of Energy maintained the same position saying government had no intention to go back to quarterly or yearly reviews of fuel pump prices.

“The country has tried long term review cycles before and we ended up with large fuel price increases and a very large government debt from unpaid fuel bills,” Eng. Kapala said.

Eng. Kapala added that this was due to the fact that the government could not sustain subsidies and could not pay suppliers on time.

“Delaying price reviews doesn’t make the problems disappear. This only compounds the problem, like papering ( adhering wall paper) over cracks on a wall,” he said.

For the month of July 2022, the Energy Regulation Board (ERB) revised the pump price for Petrol upward by K1.80 per litre bringing the new price to K26.75.

The price for Diesel was also adjusted upwards by K2.37 bringing the new pump price to K28.01 and that of Kerosene at K2.51, bringing its pump price to K 21.27, respectively.

ERB Board Chairperson Reynolds Bowa attributed the adjustment to the unprecedented increase in the price of petroleum products on the international market.

“The recorded increase in international oil prices was mainly attributed to the global oil demand and supply imbalance caused by a combination of factors such as the continued geopolitical tension in Ukraine and Russia and increased oil demand worldwide which has caused premium demands for both product prices and freight costs,” he said.

Mr. Bowa stated that the demand has put pressure on the landed cost of petroleum products, hence, the prices of petroleum products on the local market have all surpassed the threshold for upward price adjustment.

16 COMMENTS

  1. Just reopen Indeni. It’s only Indeni that’ll make it possible for you to buy bulk crude to last 3 to 6 or more months thereby making it possible for you to maintain the same price for the same duration. The current setup can’t allow that. Your stubbornness will take you to the rubbish bin soon

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  2. OPEN INDENI ?
    HAVE ANY SEEN THE STATE OF REPAIR ITS IN ? THE FUNDS TO REHABILITATE IT COMING FROM WHERE ?
    ANOTHER LOAN ? NO THANKS
    MONTHLY REVIEW IS FINE FOR NOW

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  3. Change of stance just like this? You promised removal of middle men to reduce price to k4 per litre. Ok but twalibepwa mwe!

  4. It appears our government doesn’t understand one of their jobs is to shield citizens from international factors by way of subsidies.
    This excuse of having cost reflective prices is an open failure, cost reflective shouldn’t be in the vocabulary of a minister of energy. Deal with cost reflective in your internal meetings, coordinate with the ministry of finance and cushion us from ‘cost reflective prices’.
    Whatever happened to the President’s famous formula? Would be nice to hear his views on that now.
    Also, no such title as Eng, please!

    • There is little or no room for subsides and cushioning from global shocks with the level of debt and wrecked economy PF left………..

      Towards 2025 , there will be room for GRZ to cushion Zambians

  5. Are some of the bloggers living on another planet. Do you read the news from the whole world. Do you not see what is happening in the whole worl, Europe, Asia, Africa, Australia etc. Look at the strong economies in Africa, SA, Rwanda, Nigeria, Kenya – what is happening there on fuel.

    So why are you critcising Zambia ? Wake up – IT IS A GLOBAL PROBLEM. CAN’T YOU SEE FOR GOD’S SAKE.

    Yes middlemen have to be removed as much as possible – BUT AFTER PAYING OFF ALL OLD DEBTS TO THOSE WHO ARE OWED BY PUMPING THE PRICE UP.
    INDENI – YOPU MUST BE JOKING
    Bloggers be constructive please – we are still at least okay – God forbid it goes belly up. Look at SA – hospitals, Airports, malls black outs etc etc. Look at the collapse of the Rand – THAT IS WHAT YEARS OF CORRUPTION DOES – YEARS OF…

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    • Yes the whole world is facing massive inflation and high devaluation of their currencies. But mighty ZAMBIA has reduced inflation to single digit and mighty Kwacha has beaten the RSA Rand. Yes my friend we do read world news and we also have brains to decipher lies and truth.

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  6. Failures after Failures. Fuseke upnd f00Is.

    Fellow bloggers I am dying with hangover. What is the best cure for hangover

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  7. Open indeni and buy fuel that will last for months? ahahhahaha, another pF cadre thinking with his anus. Thats exactly why we closed Indeni-we dont want it to be doing what the senegalese or somalians are already doing-Buying and Reselling. KK built this as an oil refinery plant, not buy and sell. Hence we are restructuring it back to its intended purpose, but this time it will do even more-production.

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    • So any suggestion different from the minister is PF? Just explain why indeni is not a good idea. Accusing people of being PF shows lack of brains.

  8. I guess the current administration didn’t see the Ukraine and Russia war. Surely any sane person can see the value of having companies like Indeni. They would reduce these drastic shock waves. Folding of arms waiting for market forces to be in our favour is just duffed. Please do something or get out of that office.

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