Zimbabwe threatens fuel dealers

Zimbabwe threatens fuel dealers

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By Staff Reporter

ZIMBABWEAN authorities have threatened defiant fuel dealers who have refused to cut fuel prices in line with a government directive, it was reported on Friday.

State radio said the dealers who are selling fuel for prices of up to 1000 new Zimbabwe dollars (US$4 at the official exchange rate) per litre, instead of the gazetted Zim$320 a litre for diesel and Zim$335 for petrol, would face legal action.

Energy Secretary Justin Mupamhanga says the fuel dealers had previously agreed to the new government prices and were merely profiteering, the official Herald newspaper reports.

"People sat down and agreed and made a publication (on the new fuel price). For them now to ask me saying we cannot sell at this price... I do not think this is fair," Mupamhanga was reported as saying.

The sticking point appears to be the different values for hard currency in Zimbabwe.

President Robert Mugabe's government has pegged the value of one US dollar at 250 Zimbabwe dollars but on the widely used parallel market, the greenback fetches around Zim$600.

But fuel dealers say they are not being allocated foreign currency by the government to import the precious commodity and have to use their own hard cash.

Already drivers are finding it difficult to buy fuel as many fuel stations are refusing to sell to individuals, preferring to deal with companies who may be able to pay, albeit illegally, in hard cash.

Analysts have predicted another round of serious fuel shortages because of the price dispute.

In July, Zimbabwe knocked three zeros off its currency to deal with hyperinflation of 1 200%. - Sapa-dpa

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