20 Oktober 2021 | Wirtschaft

No hand brake for fuel prices

The IMF says futures prices point to an oil price of US$65.70 per barrel in 2021—59% higher than the 2020 average.

Given current data, the estimated upper bound for annual inflation in Namibia in 2022 is 4.7% year-on-year. – IJG Securities

Jo-Maré Duddy - Fuel prices, which have soared recently, are likely to remain high in the coming months but begin to retreat early next year.

While energy prices "will be elevated" for the next couple of months, "we expect that to come back down by the end of the first quarter next year and into the second quarter," the chief economist of the International Monetary Fund, Gita Gopinath, told AFP.

The outright price of Brent crude has surged more than 60% this year and hit US$85 for the first time since 2018 on Friday.

Currently petrol at Walvis Bay costs N$14.45 per litre – N$2.80/l or 24% more expensive than a year ago. Diesel at the coast sells for N$14.18/l – an increase of N$2.60/l or nearly 23% from October 2020.

Fuel prices in Namibia have already been hiked six times this year and petrol prices currently are at all-time highs. More expensive petrol and diesel have also been fuelling the price monster in the country.

Overall transport inflation in September printed at 7.5%, according to the Namibia Statistics Agency (NSA). In September 2020 it was 1.3%. Inflation for the operation of personal transport equipment, which includes the fuel price, came in at 11.6% compared to -3.5% a year ago.

According to IJG Securities, transport - the third largest basket item by weighting - was the largest contributor to overall annual inflation in September, contributing 1.0 percentage point to the total 3.5% annual inflation rate. In September 2020, overall year-on-year (y/y) inflation in Namibia was 2.4%.


Cirrus Capital says more expensive fuel will contribute to higher inflation looking forward.

“Fuel prices also have the second-round impact of higher costs for many goods and services, given that fuel is a large input for many and will also result in higher logistics costs. However, these second-round effects typically have a lag of several months. This may offset benefits from slower food price inflation should there be good harvests in the region (in light of the favourable rain forecasts),” the analysts comment.

IJG warns that elevated global shipping costs and the ongoing shortage of microchips and semiconductors pose a threat to production in a variety of industries.

“IJG’s inflation currently predicts that annual inflation will rise to 3.6% y/y in November and 3.8% y/y in December 2021. Average annual inflation for 2022 is forecast at 3.6% y/y. Given current data, the estimated upper bound for annual inflation in Namibia in 2022 is 4.7% y/y. The current uncertainty in the global economy makes this is a highly tentative prediction,” according to the analysts.

The IMF recently released its World Economic Outlook, in which its forecasts an overall inflation rate of 4.0% for Namibia in 2021, the highest since 2018 when the rate was 4.3%.

The IMF’s forecast for Namibia is considerable lower than the average of 10.7% it projects for Sub-Saharan Africa. For both 2022 and 2026, the IMF currently expects inflation in Namibia to average 4.5%.


In its World Economic Outlook, the IMF says futures prices point to a downward sloping curve, or backwardation, with oil prices at US$65.70 per barrel in 2021—59% higher than the 2020 average— falling to US$56.30 in 2026.

“Market tightness is expected to continue—in line with the International Energy Agency’s (IEA) oil demand recovery projections,” the IMF says.

One of the main factors underpinning prices has been the reluctance of the Organisation of the Petroleum Exporting Countries and allies, known as OPEC+, to ease supply cuts, made during the worst of the pandemic, more rapidly.

The IEA recently said a global energy crunch is expected to boost oil demand by 500 000 barrels per day (bpd) and could stoke inflation and slow the world's recovery from the Covid-19 pandemic.

As a result, global oil demand next year is now projected to recover to pre-pandemic levels, the Paris-based agency said.

It made upward revisions to its demand forecasts for this year by 170 000 bpd, or a total addition of 5.5 million for the year, and by 210 000 bpd in 2022, or a total addition of 3.3 million.


An upsurge in demand in the past quarter led to the biggest draw on oil products stocks in eight years, the IEA said, while storage levels in Organisation for Economic Co-operation and Development (OECD) countries were at their lowest since early 2015.

Meanwhile, the IEA estimated that producer group OPEC+ is set to pump 700 000 bpd below the estimated demand for its crude in the fourth quarter of this year, meaning demand will outpace supply at least until the end of 2021.

Spare production capacity from the group is set to shrink rapidly, it warned, from 9 million bpd in the first quarter of this year to only 4 million bpd in the second quarter of 2022.

That output capacity is concentrated in a small handful of Middle East states, it said, and its decline underscores the need to increase investment to meet future demand. – Own report/Nampa/AFP/Reuters

Gleiche Nachricht


Renewable energy transition requires investors

vor 20 stunden | Wirtschaft

PHILLEPUS UUSIKUNamibia has the world’s second highest solar irradiation regime, high wind power potential and potential for geothermal and bioenergy developments. The potential for green...

Tritt niemals die Katze - ein Gastbeitrag

vor 20 stunden | Wirtschaft

Treten Sie niemals die Katze!Namibia befindet sich als Entwicklungsland in einer wenig beneidenswerten Lage, seine Wirtschaft ist von der Pandemie hart getroffen. Während sich entwickelte...

Investment bill will deter money

vor 1 tag - 29 November 2021 | Wirtschaft

Jo-Maré Duddy – There is no point in having an investment promotion agency like the Namibia Investment Promotion and Development Board (NIPDB) if it has...

Fuel price hike takes merry out of Xmas

vor 4 tagen - 26 November 2021 | Wirtschaft

Jo-Maré Duddy – The price of petrol and diesel in Namibia will increase by 70c per litre on 1 December, bringing the total fuel price...

Investment trends in a decarbonised world

vor 4 tagen - 26 November 2021 | Wirtschaft

PHILLEPUS UUSIKUEnvironmental, social and corporate governance (ESG) issues are material in determining the long run fundamentals of a business and bring about a different approach...

NSFAF in Schulden

vor 4 tagen - 26 November 2021 | Wirtschaft

Studentenfonds will Kreditbuch verkaufenVon Ogone Tlhage und Katharina Moser, WindhoekIn einer weiteren Anstrengung, ihre ehemaligen Begünstigten zur Rückzahlung der Darlehen zu bewegen, erwägt der Studentenfonds...

Mangel an gesunder Ernährung

vor 4 tagen - 26 November 2021 | Landwirtschaft

Von Lea DillmannWindhoek/RomDie Rede ist von einem Anteil von 0,51 Prozent der Bevölkerung in Namibia, der sich keine gesunde Ernährung leisten kann. Das betrifft immerhin...

Neustart der Passagierschifffahrt

vor 4 tagen - 26 November 2021 | Wirtschaft

Swakopmund/Walvis Bay (er) — Erstmals seit Beginn der COVID-19-Pandemie hat in Walvis Bay ein Passagierschiff angelegt. Die „MS Europa“ ist seit gestern zu Besuch und...

The SEZs a key policy instrument for Nam

vor 5 tagen - 25 November 2021 | Wirtschaft

ELIJAH MUKUBONDAThe Special Economic Zones (SEZs) are a key policy instrument that is deployed to ensure the attainment of economic goals as set out through...

CoW consistent with building plan approvals

vor 6 tagen - 24 November 2021 | Wirtschaft

PHILLEPUS UUSIKUIn October 2021, the City of Windhoek (CoW) approved 271 building plans valued at N$221.7 million of which 200 were additions, commercial and industrial...