Zimbabwe doubles fuel prices

Zimbabwe doubles fuel prices

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By Staff Reporter

THE government on Wednesday doubled fuel prices for the second time in 10 weeks, citing a weaker local currency and rising international prices, an industry official said.

Rodrick Kusano, corporate affairs manager at oil company Shell Zimbabwe, said the government had agreed to raise petrol prices to 22,300 Zimbabwe dollars per litre from 10,000 per litre, while diesel will go up to 20,800 Zimbabwe dollars from 9,600 per litre.

The changes are effective immediately, he said.

"It was now unviable for the business to operate at old prices and we think this is a very welcome developmemt that prices have been adjusted," Kusano told a news conference.

Zimbabwe has suffered erratic fuel supplies since 1999 due to chronic foreign currency shortages amid a wider economic crisis critics blame on President Robert Mugabe's government.

The fuel crisis has worsened in recent months with most garages staying dry for weeks on end and public transport operators forced to pull their vehicles off the road.

In June, the government more than doubled fuel prices, with petrol going up from the 3,600 Zimbabwe dollars it had been pegged at since August 2004 while diesel increased from its previous 3,800 Zimbabwe dollars.

Mugabe's government opened up fuel imports a few years ago, ending a monopoly formerly enjoyed by state monopoly NOCZIM, but private oil industry operators have complained that retail prices set by the authorities were far below regional levels and undermined their viability.

Zimbabwe's fuel woes have exacerbated an economic crisis gripping the southern African state, shown in food shortages, record unemployment and one of the highest rates of inflation in the world.

Mugabe, 81 and in power since independence from Britain in 1980, denies he has mismanaged the economy and instead charges it has been sabotaged by local and international opponents over his controversial seizure of white-owned farms for redistribution to landless blacks - Reuters
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