Malawi Energy Regulatory Authority (Mera) chief executive officer Collins Magalasi has said the regulator does not copy international fuel prices but consider other local factors.
Magalasi was reacting to remarks made by the country’s estranged vice-president Saulos Chilima that last Saturday’s fuel price cut is too little.
Chilima said in his televised news conference on Wednesday that Mera should reduce the price of fuel further, saying oil prices have declined globally.
“MERA has only transferred 50 percent of the global oil price decline to the consumers. MERA should reduce the price further to cushion the consumers,” said Chilima.
Mera revised downwards prices for fuel following President Peter Mutharika directive on Saturday evening.
Following the price cut, Petrol is now at K780 00 per litre, down from K930 00, representing a 16.13 percent reduction; diesel is at K765 60 per litre, from K887 00, a 13.75 percent reduction while paraffin registered a 9.71 percent reduction, now selling at K625 00 from K693 00.
Chilima said petrol should be reduced to K623 per litre petrol, K704 diesel and K504 paraffin.
However, Magalasi said it was wrong for people to equate the international pricing to the local pump price build-up.
“Fuel price determination is not arithmetic or is not one plus one,” said Magalasi.
“We don’t just copy the international price. There are several other factors that the pricing committee considers,” he added.
Magalasi said that fuel pricing is not only dependent on the cost of purchasing the commodity. He said there are other factors at play.
“The price is a product of so many things like the cost of buying fuel, the cost of transportation, insurance and cost of finance.
“It doesn’t mean that when the price at the international market has gone down by say 50 percent, then we will also reduce fuel price by the same 50 percent.”
President Mutharika directed Mera to reduce fuel prices with immediate effect to ease the public transport costs.
Public transport operators last week raised bus fares by up to 100 percent in reaction to restrictions on passenger capacity imposed as a measure to encourage social distancing and check the spread of Covid-19.Follow and Subscribe Nyasa TV :