Saturday, June 22, 2024

ERB Reduces Fuel Prices in Response to International Market and Exchange Rate Fluctuations

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The Energy Regulation Board (ERB) has announced a significant reduction in the pump prices of petrol, diesel, kerosene, and Jet A-1 fuel, effective from June 1, 2023. The adjustment comes as a result of the decline in international oil prices and the depreciation of the Kwacha against the United States Dollar.

According to the latest price review by the ERB, petrol will now cost K3.14 less per liter, diesel will be K2.77 cheaper per liter, and kerosene will see a reduction of K0.73 per liter. These reductions reflect a decrease of 11.99% for petrol, 11.05% for diesel, and 7.78% for kerosene. Furthermore, the retail or Posted Airfield Price (PAP) of Jet A-1 at Kenneth Kaunda International Airport (KKIA) and other local airports has also been adjusted downwards.

The decline in international oil prices played a significant role in the reduction of fuel prices. During the previous price review in May 2023, the average prices of petrol, diesel, and kerosene on the global market were US$93.04/bbl, US$95.22/bbl, and US$92.72/bbl, respectively. In comparison, for the June 2023 fuel price review, the average prices dropped to US$81.88/bbl for petrol, US$84.70/bbl for diesel, and US$85.51/bbl for kerosene. These changes signify a notable decrease in prices across all fuel types.

Several factors contributed to the decline in oil prices, including concerns about a potential recession that impacted the oil and gas market. Additionally, fears of a banking crisis following the collapse of some Western banks further heightened uncertainty.

In tandem with the drop in international oil prices, the Kwacha experienced a depreciation of 0.49% against the United States Dollar from an average exchange rate of K18.47/US$ in April to K18.56/US$ in May 2023. This depreciation was mainly attributed to re-emerging foreign exchange market pressures.

However, the impact of the decrease in international oil prices outweighed the effects of the Kwacha’s depreciation against the United States Dollar. As a result, domestic fuel prices have seen a favorable adjustment, leading to the reduction in prices for petrol, diesel, kerosene, and Jet A-1.

Motorists and consumers across the country can now benefit from the lower fuel prices, which are expected to provide some relief from the high cost of living. The ERB encourages fuel suppliers and retailers to promptly implement the revised prices to ensure that consumers can access the benefits of these adjustments.

The determined changes in the national uniform pump prices for June 2023 are as follows:

  • Petrol: K3.14/liter reduction
  • Diesel: K2.77/liter reduction
  • Kerosene: K0.73/liter reduction
  • Jet A-1: Retail or Posted Airfield Price (PAP) adjustment at Kenneth Kaunda International Airport (KKIA) and other local airports.

The ERB remains committed to monitoring and regulating the energy sector to ensure fair and reasonable fuel prices for consumers while considering global market dynamics and exchange rate fluctuations.

18 COMMENTS

    • Credit must go to Father Salangeta…….. Faka more pressure ba Father. They are trembling and beginning to listen.

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  1. Well done, this is good and credit must be given to the govt on this…next we want the USD down to K16

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    • ITS THE FATHER SALANGETA FACTOR……THEY HAVE FELT THE PRESSURE!!! WELLDONE FATHER….KEEP THE HEAT ON!!!

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  2. Zambians especially those who blindly support upnd are very gullible f00Is. We are now experiencing price controls under upnd. Something we only ever saw during the dark days of unip. After messing up they now appease you by directing a price reduction so that you stop complaining. Wake up Zambians. The price of mealie meal and other basic goods are still high, how come? Haha this is not market forces but HH forces. Fuseke to whoever will comment with negative things below

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  3. only I D I O T S can celebrate this. shocking that we have poop people supporting this.. What was the price fuel mu tu PF.

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  4. It’s likely that OMCs had info that the prices would go down and that’s what caused the artificial shortage that was experienced this past 4 days. We should expect this to be a common feature every month end. You can imagine if you’re a dealer and you have 30,000 litres at the end of the day, you’d lose around K90,000 within hours! So most OMCs stopped stocking up until the new price was announced. When info is leaked that the price will go up, OMCs with still hold fuel to make quick money. These fluctuations don’t make sense except to those that studied home economics

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    • That doesn’t make sense. If the price would go down, wouldn’t the OMCs sale as quickly as possible before the price reduction so as to make money when the price is higher?

  5. A strategic fuel reserve will act as a buffer such that these peaks and troughs won’t be felt by consumers. How does an economist, well versed in graphs, fail to stabilise fuel availability when the exchange rate is maintained? Are we waiting for Lobito or Maputo pipelines to tackle this? Energy minister with his president are jokers.
    Unstable currencies are just as devastating as unsteady prices as that negates proper planning.

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  6. These monthly adjustments are just for dull people into believing that the prices have gone down. Effective the price is still very high. The IMF prices are slowly being kicked in. Month the reduce by k3, next month they will increase by k5. What was the price of fuel two years ago? What is the price of electricity and other essential commodities as compared to 2 years ago?

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