Zimbabwean motorists are paying slightly more for petrol and much less for diesel, according to price changes announced by Zimbabwe Energy Regulatory Authority. The changes took effect on Friday.
The price of petrol per litre is up 12 cents to Z$18.40 in the local currency, while that of diesel per litre will be Z$2.27 lower at Z$17.28. In US dollar terms, the overall price of fuel is lower.
According to ZERA, the latest price changes were the result of lower fuel prices on the international market.
The Free On Board (FOB) price of diesel to Zimbabwe was down to US$0.4610 from US$0.6308, while that of petrol was down to US$0.4936 from US$0.5517.
Market watchers said fuel prices in the southern African country are probably the lowest in the region, given the fall of the Zimbabwe dollar on the parallel market.
While the Zimbabwe dollar official exchange rate was Z$18.46 to the US dollar on Friday, in the parallel market it had raced to 31 to the US dollar. This, market watchers say, puts the effective price per litre of petrol at US$0.60.
“Most foreign currency trades are taking place on the parallel market rather than the official market, so the real feel of the exchange rate is 31, not 18.
“Likewise, the effective fuel price is that where you use the parallel market exchange rate. Government or someone is subsidising fuel and it is not sustainable. That’s why we have these shortages and endless queues.
“We are probably importing half or less of our requirements,” said Harare-based analyst, Walter Mandeya of Trigrams Investment.