The Zimbabwe Energy Regulatory Authority (ZERA) has issued a stern warning to fuel operators against fuel price increases and hoarding of the commodity.
In a statement, ZERA said it has deployed police officers to ensure compliance with the directive.
“The Petroleum Industry is advised that the prices of fuel have NOT changed and operators are expected to continue selling fuel into the market as is expected of them.
Any operator found hoarding fuel will face the full wrath of the law. The Zimbabwe Energy Regulatory Authority (ZERA) and the Zimbabwe Republic Police (ZRP) Officers have been deployed in all the towns and cities to ensure compliance,” reads the statement.
This follows a surge in fuel prices at some filling stations across the country following the removal of the 1:1 foreign currency exchange rate for the procurement of fuel by Oil Marketing Companies (OMCs), which will result in the interbank market being used.
The move was announced yesterday by the Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya.
He said the move sought to promote the efficient use forex and to “minimise and guard against incidences of arbitrage” in the economy.
This has raised scepticism with some saying the move will open up more channels for alleged fuel barns to further tighten their grip on the precious commodity.
Exiled former Cabinet Minister Professor Jonathan Moyo described the move as a new looting scheme.
“The @ReserveBankZIM has liberalised the exchange rate and, with immediate effect, discontinued the fake 1:1 exchange rate, which was being used for looting purposes. From tomorrow (today) the interbank market will be on a willing-buyer-willing-seller basis. But #Zupco fares remain fake!” Moyo tweeted.
Former Finance Minister, Tendai Biti said the new regulations means the government is moving to dollarisation but should allow the fuel market to also redollarize to meet supply and demand.
“I see a very crude attempt to liberalize the acquisition of foreign currency. If you like to re-dollarize the acquisition of foreign currency by fuel importers, but there is a problem (because) you can’t dollarize or re-dollarize the aspect of supply without also dollarizing demand.
“In other words, when these companies acquire foreign currency at a market price when they sell the fuel, they must also be allowed to sell it in US dollars at a market price, “Biti said.
Academic and lawyer, Alex Magaisa said the move by the Central Bank would increase fuel prices hence the government was quick to reduce bus fares for the government operated Zimbabwe United Passengers Company (ZUPCO) which reduced its fares by half following the announcement yesterday.
“The government knows ditching the 1:1 fraud will lead to price increases in fuel, transport fares (and other commodities) hence the Zupco subsidy. It’s designed to forestall protests. But how sustainable is this scheme in the long run? And what about other commodities?” he said on Twitter.
Zimbabwe is facing a critical fuel shortage largely due to foreign currency shortages which have crippled industry, forcing regular price hikes and triggering labour unrest.