PETROL, DIESEL AND PARAFFIN PRICES REVIEW, MARCH, 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.

 

PETROLEUM PRODUCTS INTERNATIONAL PRICES

The average FOB price of petrol, diesel and paraffin increased when compared to the averages obtained in the month of October 2016 used in determining the ruling pump prices.

The FOB price of petrol, diesel and paraffin increased by 9.74%, 9.24% and 8.80% respectively, in the month of February 2017.

 

EXCHANGE RATE MOVEMENT

Since the last review of the In Bond Landed Cost (IBLC) of petroleum products in November 2016, the Malawi kwacha has remained stable trading at K733.50 against the United States Dollar as noted on 6th March 2017.

 

PUMP PRICES

The combined effect of movements of the FOB prices and the exchange rate of the Malawi Kwacha to the US Dollar noted in March 2017, has resulted in increases of landed cost of Petrol, Diesel and Paraffin by 12.27%, 15.33% and 16.11%, respectively. The change in the landed cost qualified all the three products for an upward pump price adjustment.

The MERA Board considered the accumulated PSF balance in February 2017 and the fuel trading gains realized from switching back volumes from the alternative supply routes to the normal routes and volumes which are less expensive and have resulted in a reduction on the landed costs of petroleum products.

The Board has therefore resolved to maintain fuel pump price by covering in full IBLC increases through use of the Price Stabilization Fund.

Fuel pump prices have 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

 11th March 2017