The Road Fund Administration (RFA) has increased the road user charge to N$1.78 from N$1.48, in an effort to meet its funding requirements for road rehabilitations, upgrades and maintenance.
RFA requires approximately N$4.3 billion to fund its projects. The parastatal wanted to implement toll gates as a means of boosting its revenue, as it bemoaned the advent of electric vehicles, arguing that it is losing revenue due to a cut-down on fueling.
The Ministry of Mines and Energy announced the review in the latest monthly fuel review, saying the adjustments were made following a request passed by the Ministry of Finance and Public Enterprises.
“The Ministry has also received a request from the Ministry of Finance and Public Enterprises to increase the road user charges included in the prices of petrol and diesel. To that end, a resolution was taken to increase the road user charges for road maintenance and construction of new roads by 30 cents per litre from 148 cents per litre to 178 cents per litre effective 07 June 2023,” Mines and Energy Ministry spokesperson, Andreas Simon said.
Simon said that petrol prices will remain unchanged while the prices of diesel 50ppm will decrease by 80 cents per litre and those of diesel 10ppm will decrease by 60 cents per litre.
The petrol prices in Walvis Bay will thus remain N$ 19.78 per litre while the prices of diesel 50 ppm will become N$19.05 per litre while those of diesel 10ppm will become N$19.25 per litre.
The prices were influenced by significant short-term declines due to ongoing demand concerns caused mainly by the strengthening of the US dollar.
The latest calculations by the Ministry indicate that the average price for Unleaded Petrol 95 over May 2023 is at US$92.118 per barrel (compared to US$102.374 per barrel at the end of April 2023), depicting a significant decrease of about US$10 over the review period.
Additionally, the average price for Diesel 50ppm over May 2023 is at US$85.765 per barrel (compared to US$96.514 per barrel at the end of April 2023), a decrease of about US$10 per barrel over the review period. Moreover, the average price for Diesel 10ppm over May 2023 is at US$87.300 per barrel (compared to US$97.414 per barrel at the end of April 2023), a decrease of about US$10 per barrel.
“Therefore, after entering the above input factors into the fuel pricing model, the Ministry recorded over-recoveries on petrol and both diesel products, that is an over-recovery of 4 cents per litre on petrol and over-recoveries of 136 and 118 cents per litre on diesel 50ppm and 10ppm,” he said.
