REVIEW OF THE RETAIL PRICE OF LIQUEFIED PETROLEUM GAS (LPG) IN THE MONTH OF JUNE 2017.

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.

LPG PRICES ON THE INTERNATIONAL MARKET

The average Free On Board (FOB) prices for Liquefied Petroleum Gas (LPG) slightly increased in the month of May 2017 when compared to the price observed in the month of February 2017 which formed the basis of the current retail price of LPG. The average FOB price increased by 0.47% from R10.57/kg to R10.62/kg.

EXCHANGE RATE MOVEMENT

Since the last price revision on 12th March 2017, the Malawi Kwacha has slightly appreciated against the South African Rand from K56.36/ZAR to K56.30/ZAR representing a 0.11% gain in value.

RESULTANT RETAIL PRICE

MERA reviewed the combined effects of the movement of the LPG FOB prices and exchange rate of the Malawi Kwacha to the South African Rand and noted that the landed cost of LPG decreased by 4.60%. Under the Automatic Pricing Mechanism, LPG does not qualify for a price adjustment since the landed cost is within the ±5% band.

The MERA Board has therefore resolved to maintain the maximum retail price of LPG as implemented on 12th March 2017 as presented below:-                    

 Current Maximum LPG Retail Price (MWK/Kg)

Recommended Maximum LPG Retail Price (MWK/Kg)

 % Change

2,178.70

2,178.70

   -

 

 

 

 All operators are required to sell LPG at a price not exceeding this maximum retail price.

 

 SIGNED

 

 Rt. Rev. Dr. J.P. Bvumbwe
 BOARD CHAIRPERSON
  MALAWI ENERGY REGULATORY AUTHORITY
 6th June 2017.