REVIEW OF PRICES OF PETROL, DIESEL AND PARAFFIN IN THE MONTH OF MAY 2018.

BACKGROUND

Malawi Energy Regulatory Authority (MERA) considered recent trends in the world petroleum products prices and changes in other macroeconomic fundamentals in the local market and their impact on energy prices.

PETROLEUM PRODUCTS INTERNATIONAL PRICES

The average FOB prices of Petrol, Diesel and Paraffin increased in April 2018 when compared to the averages obtained in the month of October, 2016 used in determining the ruling pump prices.

The FOB prices of petrol, diesel and paraffin rose by 33.03%, 33.75% and 40.18% respectively in the month of April 2018 when compared to October 2016 FOB prices which form the basis of the ruling pump prices.

EXCHANGE RATE MOVEMENT

Since the last review of the In Bond Landed Cost (IBLC) of petroleum products in November 2016, the Malawi kwacha has depreciated by 0.06%.

PUMP PRICES

MERA assessed the combined effect of the movement of the FOB prices and exchange rate of the Malawi Kwacha to the US Dollar as well as changes in local factors that determine the maximum pump prices. It was noted that the landed costs of Petrol, diesel and paraffin increased by 11.21%, 15.11% and 23.61%, respectively. The changes in the landed costs qualified all the three petroleum products for an upward pump price adjustment since the changes in the landed cost were beyond the ±5% trigger limit.

The Board resolved to maintain pump prices for all the three products and apply the Price Stabilisation Fund (PSF) to cover the increased landed cost of the three petroleum products.

 

Fuel pump prices have therefore been maintained as implemented on 4th November 2016 as presented below:  

Product

Current Pump Price (MWK/Litre)

Recommended maximum pump price (MWK/Litre)

% Change

Petrol

 

824.70

 

824.70

          

-

Diesel

 

815.80

 

815.80

            

-

Paraffin

648.70

648.70

-

 

 All operators are required to sell petroleum products at prices not exceeding these maximum pump prices.

 

 

SIGNED

 

Rt. Rev. Dr. J.P. Bvumbwe

BOARD CHAIRPERSON

MALAWI ENERGY REGULATORY AUTHORITY

10th May, 2018