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The reduction of fuel prices on the international market over the past year is one of many price swings that the industry has experienced in the past and the same prices could still go up in response to supply and demand patterns. While other countries had reason to celebrate the drop in prices, in Zimbabwe we have not reaped anything out of the steady fall of crude oil prices internationally with our fuel suppliers proffering flimsy explanations on why they could not reduce the price or justifying their delay in price reduction that seems to be pegged on an expectation of an increase that they would immediately effect.
Fuel is a major cost driver that cuts across all sectors of the economy and a slight increase has ripple effects. We believe a marginal decrease should still do good to the economy by reducing the costs of production. This habit of local traders of passing on costs to consumers at the end of the chain but denying the same consumer the benefits of reduced prices when other countries around us have been enjoying these, as in the case of fuel, is thoroughly reprehensible and can never be condoned.
We applaud the swift move by the Government to step in and rein in the fuel suppliers who have since been directed to reduce prices with effect from Wednesday this week in line with falling global oil prices. Energy and Power Development Minister Samuel Undenge was reported yesterday as saying that he had issued fuel retailers a two-week ultimatum starting from 31 December 2014. The directive seeks to have the price of petrol at a maximum of $1,32, down from $1,54 and diesel selling at a maximum of $1,20 from the current price of $1,44.
“I am hoping to get co-operation from all players. As Government, the last thing we want to do would be to go back to price controls,” said Minister Undenge.
Indeed, we would not want to go back to price controls though it would not be prudent for Government to stand back and allow fuel dealers to ride roughshod over hapless fuel consumers. Interestingly, fuel dealers were mum when asked to comment on the pricing anomaly.
We urge the regulatory authority to read the riot act to the fuel suppliers so that they are not allowed to set a bad precedent for other sectors since such practice could torpedo our economic development efforts through increasing the cost burden on our industries.
Zimbabwe has drawn up a programme to turn around its economy and we believe various bodies mandated with overseeing different sectors such as the Energy Regulatory Authority, the Competition and Tariff Commission, among others, should play their part in ensuring that unjust pricing whether as a result of cartels or plain profiteering, is curtailed.
Fuel consumers can never be convinced they are not entitled to fuel price decreases being effected in other countries especially now that we use the American dollar largely, in which crude oil prices are pegged. It is our hope that a similar trend does not obtain on other products that could be overpriced locally under flimsy reasons.
Our businesspeople should be principled and be people of integrity whose operations are guided by values that seek to take Zimbabwe forward economically from a springboard of best practice.
Online Reporter