HARARE – Zimbabwe’s fuel is the most expensive in southern Africa despite government introducing its controversial mandatory blending policy which forces fuel companies to mix unleaded petrol with ethanol as part of reducing the import bill.
In a paper on the prices of fuel, the Zimbabwe Energy Council (Zec) noted that the country’s commodity was overly priced even compared to other land locked countries whose transport costs and levies were much higher.
“(In) June 2017, the price of fuel decreased by 25c (South African cents) in RSA, again in July, the fuel price decreased by further 69c (South African cents).
“In Zimbabwe it’s the opposite, when every other nation is decreasing its fuel prices, we are increasing ours! What drives and determines fuel prices in Zimbabwe, more so when we are using a stable USD currency?” questioned Zec.
According to statistics gathered by Zec, Zambia, a landlocked country like Zimbabwe, unleaded fuel is currently selling for $1, 11 per litre.
Petrol per litre was retailing at $0, 95 cents in Angola, $0, 74 cents in Botswana, $0, 79 cents in Lesotho, $1, 10 cents in Malawi, $0, 95 cents in South Africa, $0, 91 cents in Swaziland and $1, 30 in Zambia.
In Zimbabwe a litre of (petrol) blend is averaging 1,32.
Diesel was retailing for $0, 80 cents in Angola, $0, 70 cents in Botswana, $0, 81 cents in Lesotho, $1, 09 in Malawi and $1, 11 in Zambia.
In Zimbabwe it is averaging $1, 18.
“The issue of being landlocked does not apply here, Zambia which is further and its fuel passes through Zimbabwe every day is marginally cheaper than our fuel,” Zec argued.
Government unilaterally enforced mandatory blending of petroleum products almost four years ago, claiming it would bring down prices and reduce the country’s import bill.
Official figures show Zimbabwe spends some $45 million each month to import fuel.
The introduction of petrol blending has been a subject of fierce opposition from motorists with a suit being filed at the Constitutional Court to reverse the mandatory blending.
On Friday government announced it had petrol blending from 10 to 20 percent due to increasing supplies of ethanol.
In March, government had reduced to five percent from 15 percent the mandatory amount of local ethanol to be blended with petrol as heavy rains affected sugarcane fields.
Zimbabwe obtains ethanol from a $600 million sugar plant in the southeast of the country which is jointly owned by a State company and private investors which has capacity to produce 250 000 litres of ethanol a day.
This year’s heavy rains forced government to reduce the blending figures to five percent, a period which also coincided with the annual suspension of full-scale cane harvesting.
Between December and April, sugar cane harvesting is halted to enable plant maintenance, leading to a moratorium in the production of ethanol.
The off-crop season is now over, and sugar milling has resumed, resulting in a boost in ethanol supplies.