The Ministry of Mines and Energy has announced an increase in diesel prices by 198 cents per litre, effective at 00h01 on 02 November 2022.
In a media statement made available to Nampa on Monday, the ministry said the international oil market continues to expect a huge fall in oil demands amid strong signs of poor performance across many economies.
It further predicted that there will be a global economic slowdown as the federal reserves and other central banks continue to increase interest rates to counter inflation.
“Oil prices are expected to rise in the coming months following the anticipated ban on Russian crude oil by the European Union, which is expected to come into effect on 05 December 2022. In addition, it appears that OPEC has also agreed to reduce crude oil output by about a million barrels per day from 01 November 2022. This means that the supply of crude oil throughout the global market will likely decrease in the coming months. When oil supply decreases, oil prices increase,” the statement said.
It added that the Namibian Dollar (NAD) has depreciated against the United States Dollar (USD), with the current exchange rate pegged at N.dollars 18.0870 cents per USD1.00 compared to N.dollars 17.5851 at the end of September 2022.
“Also, the public must take note of the road user charges and the Motor Vehicle Accident Levy which were reinstated in October. This has also placed additional pressure on the local fuel prices that are paid by consumers at the pumps,” the statement said.
It further added that the currency depreciation continues to contribute to fuel price under-recoveries and an ultimate negative effect in terms of the pockets of local fuel consumers.
The ministry concluded by saying it is confident of continuous setting of prices that are reflective of oil market dynamics to ensure the security of fuel supply in Namibia.