Patience Makwele
The government has reduced fuel prices for July and announced a major overhaul of Namibia’s fuel procurement system after spending N$1.3 billion cushioning motorists against soaring international oil prices.
This was announced by the minister of industries, mines and energy Modestus Amutse on Wednesday during an information sharing session in Windhoek.
The minister revealed that the price of petrol will decrease by N$1.00 per litre, while diesel 50ppm and diesel 10ppm will each drop by N$4.00 per litre, effective from midnight on 3 July.
The reductions bring the Walvis Bay pump price of petrol to N$22.48 per litre, down from N$23.48 in June. Diesel 50ppm falls from N$28.26 to N$24.26 per litre, while diesel 10ppm decreases from N$28.36 to N$24.36 per litre.
Pump prices in other towns will be adjusted accordingly.
Amutse attributed the reductions to lower international crude oil prices, easing geopolitical tensions in the Middle East, declining shipping costs and a stronger Namibian dollar, all of which reduced the cost of importing petroleum products.
“The ministry remains committed to ensuring that fuel prices reflect international market conditions while balancing economic sustainability for consumers and the industry,” he said.
Beyond the monthly fuel price adjustment, the minister announced a coordinated fuel supply arrangement that will run from July to September 2026, eliminating import premiums previously charged above the Basic Fuel Price (BFP).
He said removing the premiums will reduce fuel procurement costs, contain upward pressure on domestic fuel prices and strengthen the financial position of the National Energy Fund (NEF).
According to Amutse, the NEF absorbed approximately N$1.3 billion in fuel price under-recoveries during April and May to shield consumers from higher pump prices. Import premiums alone averaged about N$300 million per month.
“If there were no premiums on top of the basic fuel price, we would not have spent that much,” he said.
He added that removing the premiums would allow the government to redirect savings to other priority sectors such as education and healthcare.
Responding to questions from the media, Amutse said the premiums had originally been introduced through an agreement with petroleum wholesalers to cover unforeseen supply risks associated with importing fuel.
However, he said the arrangement had become unsustainable.
“Those costs have been impacting negatively on the economy, especially on ordinary people. We cannot allow this situation to continue because our people are facing hardships,” he said.
Amutse said the temporary three-month arrangement will serve as a transition to a permanent Bulk Petroleum Import Coordination System, under which fuel wholesalers will jointly procure petroleum products to achieve economies of scale, improve transparency and lower import costs.
He said the proposed system has already been discussed with industry stakeholders and enjoys broad support.
Draft regulations governing the new procurement model are at an advanced stage and are expected to be released for public scrutiny and gazetted within the coming weeks.
The July reductions follow the government’s decision to keep fuel prices unchanged in June after steep increases in May, when global oil prices surged amid heightened tensions in the Middle East.
The latest adjustment reverses part of those increases as international market conditions continue to improve.
