Zimbabwe has slashed fuel prices for private motorists by almost half after gas station owners unilaterally hiked rates in the wake of a serious oil crunch, a state daily reported on Friday.
”Government and the oil industry have with immediate effect fixed the price of diesel at Z$320 ($1,28) and that of petrol at Z$335 a litre for all users in the country,” the Herald said.
Petrol stations earlier this month unilaterally increased prices, selling a litre of petrol at between Z$600 and Z$800 a litre, resulting in a steep increase in public transport costs.
”On August 11 2006, [the] Cabinet approved the new prices of fuel of Z$320 and Z$335 per litre for diesel and petrol, respectively,” the Herald quoted Energy Minister Mike Nyambuya as saying.
”These are the prices my ministry, together with the oil industry, had agreed on in our consultations and are applicable immediately.”
While the latest price ceiling is a relief for private motorists, it translates into an increase for farmers and government and public transporters who were buying fuel at the heavily subsidised rate of Z$230 per litre from the state oil firm Noczim.
”Because the price has increased significantly, it may be a substantial challenge to some farmers,” Nyambuya said.
”Any farmer who finds it difficult to buy fuel for farming activities should approach his bank to access the facility fund that has been set up by the Reserve Bank.”
Zimbabwe has been experiencing serious fuel shortages since 1999 and the government blames the woes on Western sanctions imposed on President Robert Mugabe’s government six years ago.
When the shortages are at their peak, some gas stations go for months without fuel, forcing buses and private cars off the road and leaving many with no option but to walk to or cycle to work.
To ease the chronic fuel shortages, the government last year removed its monopoly on fuel imports to allow those with access to foreign currency to import their own fuel. — Sapa-AFP