BLANTYRE-(MaraviPost)—Fuel prices in Malawi will not be increased despite rising oil prices on the international market as the Malawi Energy Regulatory Authority (MERA) has committed to cover any anticipated importation loses by the fuel importers with Price Stabilization Fund, MaraviPost has learnt.
In a press statement, Friday, made available to the MaraviPost, MERA says the average FOB (Free On Board) prices of petrol, diesel and paraffin increased in the month of June 2020 by 111.93%, 77.1% and 155.32%, respectively when compare to the average prices which were applied when determining the ruling prices.
According to MERA, the increase in the FOB prices on the international market is attributed to output cuts by the OPEC+, and increased demand of oil following the easing of COVID-19 lockdown restrictions in consuming countries.
“MERA assessed the combined effect of the movement of the FOB prices and exchange rate of the Malawi Kwacha to the United States Dollar as well as changes in local factors that determine the maximum pump prices. It was noted that the landed costs of petrol, diesel and paraffin increased by 44.89%, 28.69% and 51.04%, respectively.
“Therefore, in line with the Automatic Pricing Mechanism (APM) all the three products qualified for an upward price adjustment since the changes in their landed costs were beyond the ±5% trigger limit. However, the MERA Board resolved to maintain pump prices at the current levels and that any anticipated importation loses by the fuel importers will be covered by the Price Stabilization Fund,” reads the statement partly.
This means that prices of Petrol, Diesel and Kerosene will remain at K690.50, K664.80 and K441.70 per litre respectively.