Mera speaks on fuel prices
The Malawi Energy Regulatory Authority (Mera) has said it is monitoring fuel price movements on the international market before it moves to adjust prices.
Fuel prices have remained volatile on the international market, with the local unit, the Kwacha, equally losing its grip on other major trading currencies, factors which could partly guarantee a pump price hike.
Monday, Mera issued its 2020-21 Highlights, a review of trends in the energy sector including fuel price movement, which was seen to have been on an upward spiral between October 2020 and April 2021, but remained stable henceforth.
In an interview, Mera spokesperson Fitina Khonje said, while working to cushioning local pump prices, the regulator would still ensure continued security of fuel supply.
“Generally, for continuity, prices have to reflect what is happening on the international market and, secondly, we don’t have sufficient funds in the Price Stabilisation Fund (PSF) to keep cushioning the prices.
“But the decision would be made by the Mera board. But, at the same time, we don’t know what will happen in between now and the time when the board meets,” Khonje said.
In a recent statement, Mera said, since the establishment of ruling pump prices in March 2021, the landed costs of petrol, diesel and paraffin have increased by 23.51 percent, 16.03 percent and 16.37 percent, respectively.
In addition, as at August 2 2021, PSF balances for petrol, diesel and paraffin averaged K1.7 billion against the recommended minimum price of K5 billion.
In a separate interview Monday, Consumers Association of Malawi (Cama) Executive Director John Kapito warned that a rise in international prices, coupled with other domestic variables, could lead to a possible surge in pump prices.
“The prices for fuel went up a while ago. The prices we are paying at the pump are not the right price. Because the fuel prices went up drastically for the past four months or so, I think Malawi is holding on to the old prices because it is a political issue in this country. If it was an economic issue, the prices must have gone up by now,” he said.