• Crude oil prices on the international market have been increasing.
• They are at 98 US dollars per barrel and by next week they could be more than 100 US dollars per barrel.
• This is because of the geopolitical tension between Russia and Ukraine.
An Energy Expert says Zambia is likely to see an upward adjustment in fuel pump prices following the increase in crude oil prices on the international market.
Speaking in an interview with Money FM News, Engineer Johnstone Chikwanda noted that Crude oil prices on the international market have been increasing at a faster rate in the last few months as they have shot up by about 30 percent this year alone, now trading at US$98 per barrel and may soon rise to US$100 per barrel.
Engineer Chikwanda attributed the high crude oil prices to the ongoing geopolitical tension between Russia and Ukraine.
“The Crude oil prices on the international market have been increasing, they have been moving up very fast in the last few months. This year alone they have shot up by at least 30%, they are at US$98 per barrel meaning that they have virtually reached US$100 per barrel mainly because of the geopolitical tension that is taking place in Asian Continent between Russia and Ukraine to be specific,” Engineer Chikwanda said.
He stated that although there is no full blown war in the two countries, the entry of Russian troops into Ukraine, heightens a lot of fears in the market.
“In as much as there is no full blown war, the fact that Russian troops have now entered Ukraine, heightens a lot of fears in the market because the commodity market is a very sensitive market. It can easily be destabilized by mere fear or mere speculation and prices can quickly go up,” he noted.
And Engineer Chikwanda noted that the minor appreciation of the Zambian Kwacha cannot prevent a possible fuel pump price increase.
He said based on the prevailing situation, it is reasonable for consumers to speculate that there will be an upward adjustment in the price of petroleum products.
“If it doesn’t happen, then I will be very interested to know that perhaps it is other interventions which government will put in place. But otherwise, when you look at things the way they are standing, we are all very apprehensive, the crude oil prices have never reached this level in a very long time, and virtually next week, they could even be more than US$100 per barrel.”
“When things are moving like that, there are very little options and government has got very little options to avert a possible upward adjustment in fuel prices,” Engineer Chikwanda stated.
Oil and gas prices on the international prices rose yesterday on fears that the Ukraine-Russia crisis will disrupt supplies across the world, with Brent crude oil touching a seven-year high of more than US$99 a barrel.