Energy Expert Dr. Johnstone Chikwanda says the fuel pump price reduction of August 2022 saved consumers K440 million.
Chikwanda said the reduction in the fuel pump price for September 2022 will save consumers K240 million by the end of the month adding that by the end of September 2022, consumers will have been saved a total of K680 million which is considerable combined savings on the part of the consumers.
According to information availed to the Zambian Business Times-ZBT, Chikwanda said from January 2022 to July 2022, return on Investment (ROI) in the oil Industry covering Oil Marketing Companies (OMCs) and Retailers deteriorated by at least 40% due to continued price hikes by the regulator while the regulated industry margins remained fixed leading to significant pressure on the working capital thereby leading to recapitalization options in most cases.
He explained that due to the immediate past two fuel price reductions, pressure on working capital is expected to reduce ranging between 15 % to 20% and subsequently lead to an improvement in the Return on Investment.
Chikwanda further added that it is a welcome development if the international price of crude oil does not increase significantly by end of September 2022.
The Expert noted that there is a significant possibility of a further fuel pump price reduction triggered by the continued strengthening of the Zambian Kwacha.
