By: Kelvin Chiringa
The mines ministry is expected to announce the latest fuel price this Thursday morning at the back of consumers feeling the pressure due to hiked diesel and petrol prices.
The announcement is expected at 09:00.
However, economists are sceptical of the possibility of consumers escaping a fuel price hike considering the latest developments in international commodity prices and the raging war in Ukraine.
This week, reports have been that the oil market has been rocked by Covid-19 fears with China planning to lock down its population in Shanghai, possibly weakening demand.
At the same time, US crude fell by 7 per cent, and Brent lost 6.8 per cent at the back of the Covid news, undoing the gains that have been made thus far.
“The heavy selloff comes after officials in China announced plans to lock down half of Shanghai for mass Covid-19 testing beginning Monday,” a CNN report said.
Given these dynamics, an economist at Twilight Capital, Mally Likukela, said that chances are high that the ministry will hike prices.
Likukela’s fears are also being echoed in South Africa, where fuel prices are expected to increase in April.
“The state has the national energy fund created for this purpose that when there are short-term disturbances in international energy prices, the government takes money to compensate the industry so that they do not adjust their prices upwards.
“But right now, I do not know the balance in there, but I suspect that the balance is not good, and that is why they have not been able to absorb the shock. If nothing has been done, I do suspect another increase,” he said.
Another way government can mitigate the impact is by looking for money and putting it in the fund to avoid the catastrophe that comes with the international commodity prices filtering through inside Namibia.
The Namibia Bus and Taxi Association (NABTA) national chairperson, Pendapala Nakathingo, said that taxi and bus drivers are reeling and cannot take another blow without adjusting fares.
“This time around, as I have said, our members are suffering, and the previous increase was so heavy. If there is any other coming increase, we will have no other option but to approach government for an increment,” he said.
The Namibia Taxi and Transport Union (NTTU) administrator, Werner Januarie, said they would support any push for a taxi fare hike.
“Of course, we will support anyone who suggests or pushes for an increment. But for us, we are not going to engage in those matters right now directly,” he said.
The fuel price increases have so far pushed the prices of essential commodities at the back of projections that Global food prices are set to increase drastically for the rest of 2022.
Ukraine and Russia produce an estimated 20% to 30% of all corn, maize and wheat consumed worldwide.
Namib Mills has said an increase during April in wheat flour, pasta, bread, rice, maize meal, instant porridge and sugar will hit Namibian shelves.