Tinashe Makichi in Victoria Falls
Government plans to set up a fuel stabilisation fund to cushion consumers from acute fuel price increases which would act like a buffer to cushion consumers from fuel price increases.
The price of fuel has been increased four times since January triggering price increases in the economy. This has the price of petrol and diesel jumping to ZWL$7.47 and ZWL$7.19 respectively from ZWL$1.32 and ZWL$1.24 in January.
The fund is part of a cocktail of measures that Ministry of Energy and Power Development is working on to address energy issues affecting the country. The Ministry has to date come up with short to long term measures to address the prevailing fuel crisis.
Energy and Power Development Deputy Minister Magna Mudyiwa told the CZI Annual Conference in Victoria Falls that consultations on the fund would begin soon.
“The Ministry will be proposing a Fuel Stabilisation Fund which would act like a buffer to cushion the consumers from acute fuel price increases. Consultations will shortly be taking place within Government over the matter,” Mudyiwa said.
She said government wants to extend the fuel pipeline to the western parts of the country to improve supply availability and also supply the regional market, while also looking at constructing a second pipeline from Beira to improve pumping capacity and exploring potential for establishing an oil refinery.
Mudyiwa said the existence of the legacy debt has resulted in “international oil companies being unable to extend further credit to local players, preferring to be paid up-front instead”.
“The Ministry continues to engage the Ministry of Finance and the Reserve Bank to come up with modalities to extinguish the debt,” she said.
Fuel supplies have remained erratic despite the increase in price. Zimbabwe consumes about 2 million litres of petrol and 3,6 million litres of diesel daily.
