It will cost Namibia’s National Energy Fund approximately N$500 million in April alone to cushion consumers from a sharp spike in global oil prices, even as pump prices rise across the country.
The Ministry of Industries, Mines and Energy said the intervention comes against a backdrop of surging international fuel costs, driven by escalating geopolitical tensions in the Middle East and a weakening Namibia dollar.
“The remaining under-recovery will be absorbed by the National Energy Fund, amounting to approximately N$500 million,” the ministry said.
Despite the support, government has approved significant fuel price increases effective 1 April 2026, with petrol rising by N$2.50 per litre and both diesel grades increasing by N$4.00 per litre.
This will see fuel prices in Walvis Bay set at N$22.08 per litre for petrol, N$23.63 for diesel 50ppm and N$23.73 for diesel 10ppm, with inland prices adjusted accordingly.
The latest adjustment follows a sharp escalation in global oil prices during March. According to the ministry, Petrol 95 averaged US$124.92 per barrel between 1 and 23 March, up 56.9% from February levels. Diesel prices surged even higher, with both 50ppm and 10ppm grades increasing by more than 122% over the same period.
“International oil prices sharply increased during the month of March 2026. This was mainly driven by escalating geopolitical tensions in the Middle East, particularly between the United States/Israel and Iran,” the ministry said.
It added that fears of supply disruptions, including potential impacts on critical shipping routes such as the Strait of Hormuz, have driven up freight and insurance costs, further compounding price pressures.
The depreciation of the Namibia dollar has added to the strain, with the currency weakening by 3.9% against the US dollar during the review period, increasing the cost of fuel imports.
Namibia imports all of its refined petroleum products, leaving domestic prices fully exposed to global market movements.
In response to the surge, Cabinet has approved a temporary 50% reduction in fuel levies for a three-month period from April to June 2026 in a bid to soften the impact on consumers.
“Cabinet has resolved to temporarily reduce the number of levies imposed on fuel by 50% for three months to offer relief to fuel consumers at the pumps,” the ministry said.
However, even with the levy reduction and support from the National Energy Fund, the scale of the price increases reflects the severity of the global oil shock.
The ministry said it will continue to monitor international developments and implement further measures where possible to cushion consumers while ensuring security of fuel supply.
This article was first published here in partnership with The Brief