Most fuel stations in the capital on Tuesday slashed prices of both petrol and diesel by between 11 percent and 12 percent ahead of the government deadline of Wednesday, The Source has established, with most operators saying the new prices were still competitive.
Government last week gave local oil industry up to January 14 to reduce fuel prices by almost 20 percent to $1,20 for diesel and $1,32 for petrol in line with the falling international crude oil prices.
The price of crude oil has been on a freefall since June last year were it was around $118 per barrel to $70 in December.
The freight on board (FOB) prices at Beira port stood at 0.57 and 0.52 per litre as at end of December.
Local fuel traders had not adjusted their prices to reflect this trend and maintained an average $1,50 for petrol and $1,46 for diesel.
However, a survey by The Source on Tuesday established that most service stations in the capital had for the past two days partially complied with the government directive although some were implementing it gradually.
At Zuva service station along Samora Machel, diesel was selling for $1,29 per litre while the price of petrol had gone down to $1,41 from $1,50.
“We reduced the prices this morning and tomorrow the prices will be further reduced to $1,36 for petrol and $1,20 for diesel,” said an official who declined to be named.
“Even if we reduce prices, we are still making a profit,” he added.
At Redan service stations, the price of petrol prices was reduced on Monday to $1,45 per litre from $1,50 while diesel was fetching $1,35 from $1,40.
Extreme along Nelson Mandela Street said they reduced their prices two days ago to $1,32 and $1,20 respectively.
Total service stations were, however, still selling blend for $1,49 and diesel for $1,32.
“We will reduce prices when our fuel trucks arrive,” said an official, adding that it was a management decision.
Several service stations had no fuel.
One of the players in the sector who declined to be named told The Source that it was difficult to implement the government’s directive as some players were still holding old stock which they could not sell at the new price.
“Compliance will be based on stocks, no one wants to make a loss,” he said, adding that some had failed to move their stocks between November and December last year due to the shortage of ethanol for blending purposes.
“Some are still sitting on old stocks and selling them at the current price is not feasible. However, no entity will defy government’s directive but it’s an issue of timing.”
Zimbabwe Energy Regulatory Authority officials were not available to comment.
2 Replies to “Fuel Stations Slash Prices Ahead of Govt Deadline”
Comments are closed.
Government must control the price of fuel because we are using stable currency at the moment, prices of petrol and diesel affect every other business, pricing of other commodities, if the price of procuring is 50 cents a litre then at least the pump price should be pegged at a 100 cents, meaning the profit is 50 cents per litre, i believe any business can be sustained by such a profit margin, i cannot see our filling stations competing for a lower price because we are dealing in US dollar terms. It is
viable for our filling stations to sell the commodity for less in order to push volumes
unless there is a risk fee involved that i dont know of. Handling of water is different to handling of petrol. There are services that need control as they have adverse effects on the economy, the reduction in fuel prices presents us with the opportunity to
have the proper value of the US dollar. Zimbabwe must respond to market trends
so that the majority benefits, our business people have a good reflex with regards to
price increases, they are very slow at reducing prices despite the fact of having old stocks. Our profiteering rates must be monitored, especially for vital services.
Government must control the price of fuel because we are using stable currency at the moment, prices of petrol and diesel affect every other business, pricing of other commodities, if the price of procuring is 50 cents a litre then at least the pump price should be pegged at a 100 cents, meaning the profit is 50 cents per litre, i believe any business can be sustained by such a profit margin, i cannot see our filling stations competing for a lower price because we are dealing in US dollar terms. It is
viable for our filling stations to sell the commodity for less in order to push volumes
unless there is a risk fee involved that i dont know of. Handling of water is different to handling of petrol. There are services that need control as they have adverse effects on the economy, the reduction in fuel prices presents us with the opportunity to
have the proper value of the US dollar. Zimbabwe must respond to market trends
so that the majority benefits, our business people have a good reflex with regards to
price increases, they are very slow at reducing prices despite the fact of having old stocks. Our profiteering rates must be monitored, especially for vital services.