(Ecofin Agency) - In Zimbabwe, the price of fuel is expected to rise steeply next week after the rise in global petroleum prices two weeks ago.

The price of crude oil in the global market has been declining since June 2014 after reaching a record high of $118 a barrel before declining to $28 per barrel in January this year.

the pump price of petrol as at present is between $1,20 and $1,24 per litre while diesel is between $0,92 and $1,04 per litre.

Local petroleum prices still exceeds those in other countries in the region.

According to Gloria Magombo, Zimbabwe’s Energy Regulatory Authority (ZERA) chief executive officer, the rise in fuel prices on the global market will drive local prices northwards.

“We always follow that pattern but we are always behind by two to three weeks. When prices are coming down, we are always behind in adjusting our fuel prices and when (there is an uptick in oil prices) we expect the local market to react accordingly,”Magombo said.

Indigenous petroleum companies have said that they will increase prices so as to sustain profit margins. There have been suggestions that they are likely to rapidly increase their retail prices next week, and negotiations have begun with ZERA on the modalities of an adjustment.

In 2015, the government made Oil companies reduce their retail prices after they conserved the price of petrol at $1, 50 per litre and diesel at $1, 38 per litre, regardless of the decline in international oil prices. The Oil companies have then decided that since the government had raised the fuel levy when prices dropped, in order to safeguard the flow of revenue, they estimated Treasury to decrease the levy once prices start rising, Nehanda Radio news reports.

Anita Fatunji