Pump fuel prices are set to rise again at the pumps, bringing more pain for hard-pressed motorists,as international oil prices have escalated and the Malawi Kwacha has taken a knock falling by an average of one kwacha daily since Tuesday last week.
The impending fuel price hike has prompted the retail fuel filling station owners especially in Mzuzu and some in Lilongwe to hoard the commodity awaiting new prices to be announced by the Malawi Energy Regulatory Authority (MERA).
The increase will be as a result of adopted Automatic Price Adjustment mechanism by government where any changes below and beyond 5 percent will necessitate the commodity price movement either upwards or downwards.
The Malawi Kwacha has taken a knock from last week trading from K284 to a dollar down to K291 to a dollar, quoted by the high street banks today.
On the other hand the price of Brent crude oil has moved by about US11 per barrel on the international market due the shutdown of oil production in the Gulf of Mexico, the closing of some oil rigs, the slowing of delivery of crude oil by tankers destined for the United States’ ports because of tropical storm Isaac.
The situation has also pressed the demand on the supply of crude in the Middle East due to escalating price of the commodity.
On the local scene, slowdown and uncertainty in donor aid inflows due to hanging governance issues still to be cleared and increase in demand of foreign exchange due to the onset of agricultural calendar where imports of fertilizer, seeds and pesticides has began, has also led to the softening of the local unit.
Coupled with high electricity tariffs, an increase in food prices and a weakening Kwacha has sent shockwaves throughout the country giving birth to uncontrollable industrial strikes in major cities.
Food inflation is also on the rise because of a drought in many parts of Malawi leading to escalating prices of maize now at K3500 a bag of 50 kilograms.
Over the past month, the price of Brent crude oil has increased by $11 to more than $110 a barrel and the Kwacha has softened by more than 10 percent since the last adjustment.