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 June 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 38.59%, 38.13% and 42.79% respectively in the month of May 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% from K733.50/USD noted at the last price review in November 2016 to K733.95/USD noted in June 2018.
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 and noted that the landed costs of Petrol, diesel and paraffin increased by 14.70%, 17.69% and 25.34%, 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 costs were beyond the ±5% trigger limit.
The MERA Board resolved to adjust upwards pump prices for all the three products through adjustment of the deemed landed costs for Petrol, Diesel and Paraffin to reflect the increasing actual landed costs of the products.
Fuel pump prices have therefore been adjusted upwards effective 17th, July 2018 and are presented below:
All operators are required to sell petroleum products at prices not exceeding these maximum pump prices.
Rt.Rev.Dr. J.P. Bvumbwe
MALAWI ENERGY REGULATORY AUTHORITY
16th July, 2018