The Government, meeting in a session of the Council of Ministers, announced on Wednesday, May 6, an adjustment in fuel prices, justifying the revision as being aligned with international market prices. In practical terms, diesel increased by 45.5%, now costing 116.25 meticais per litre. Gasoline rose by 12.1% to 93.69 meticais per litre.
“For more than two months, the Government has been closely monitoring the evolution of the conflict in the Middle East and, as is widely known, this conflict has triggered an increase in fuel prices internationally and across the African continent. In Southern Africa in particular, there has been a widespread rise in prices,” argued the Chairman of the Energy Regulatory Authority (Arene), Paulo da Graça.
The new prices came into effect today, Thursday, May 7. According to the official, “the price of gasoline rises to 93.69 meticais per litre, from the previous 83.57 meticais, while diesel increases from 79.88 meticais to 116.25 meticais. Kerosene rises from 66.86 meticais to 97.56 meticais per litre, cooking gas will increase from 86.05 meticais to 87.82 meticais per kilogram, and compressed natural gas for vehicles will go from 41.11 meticais to 52.73 meticais per litre.”
According to Paulo da Graça, the fuel price update had been expected to take place between the end of April and the beginning of May, taking into account international market prices. He added that since the beginning of last month, Mozambique has been receiving these products at newly increased international prices.
For several weeks, the country has faced fuel supply difficulties, with fuel stations closed across the territory, widespread queues, limits on diesel and gasoline purchases, and reduced transport availability.
Prime Minister Benvinda Levi had already warned on Tuesday, May 5, that the Government would proceed with a gradual adjustment of fuel prices due to the continuation of the war in the Middle East, appealing for the public not to spread panic-inducing messages in society.
“Mozambique, being a net importer of fuels, and given the current international context, it is inevitable that it makes a gradual adjustment of the prices of these products at national level,” the Prime Minister warned during a question-and-answer session in Parliament.
Finance Minister Carla Loveira had also stated on March 25 that the Government had 5.2 million euros available in the stabilisation fund to help prevent a possible fuel price increase resulting from the conflict in the Middle East.
“This is a fund that has been used whenever crises of this nature occur. We already experienced the Russia-Ukraine conflict, which led our country to use these resources due to the very significant increase in fuel prices. At this moment, the resources amount to around 5.2 million euros,” she said.
The Executive also admitted the possibility of carrying out a budget revision “in an extreme case” if the war in the Middle East intensifies to the point of causing a widespread rise in oil prices.
“In the most extreme and adverse scenario, a budget revision may indeed become necessary. The impact of the war is felt in the economy through imported inflation and rising fuel prices, which may trigger increases in essential food prices. The conflict may also lead to higher public expenditure, not necessarily in quantitative terms, but in value terms,” she explained.
On February 28, the United States and Israel launched a military attack against Iran, during which Ayatollah Ali Khamenei, the country’s supreme leader since 1989, was killed. In response, Iran closed the Strait of Hormuz and launched retaliatory strikes against targets in Israel, U.S. military bases and other infrastructure in countries across the region.
The Strait of Hormuz, which connects the Persian Gulf to the Gulf of Oman, is crossed by around 20% of the world’s oil and a significant share of liquefied natural gas traded by sea, according to data from the U.S. Energy Information Administration and the United Nations.
Source: Diário Económico
