Staff Writer
Fuel prices are set to rise sharply this April, and many Namibians will feel the pinch at the pumps. But beyond the headline increase, a key question emerges: how much of what you pay actually goes into your tank? The answer may surprise you, because not all of what you pay for actually goes into your tank.
This is because institutions such as the Ministry of Finance, the Motor Vehicle Accident Fund (MVA) and Roads Authority amongst others take a share of the money you pay for fuel at the service station.
THE PRICE YOU SEE
The Ministry of Industries, Mines and Energy last week announced that fuel prices will increase from 1 April 2026. Petrol will go up by N$2.50 per litre, while both grades of diesel will rise by N$4.00 per litre.
In Walvis Bay, petrol will cost N$22.08 per litre, Diesel 50ppm N$23.63, and Diesel 10ppm N$23.73, with prices across the rest of the country adjusted accordingly.
To help soften the blow, the ministry confirmed that the remaining under-recovery, amounting to approximately N$500 million, will be absorbed by the National Energy Fund. This means that the taxes and levies on the fuel will be deducted by 50%.
WHO GETS YOUR CASH?
After the levy reduction, of the N$2.50 per litre in levies, about N$1.00 goes to road maintenance, N$0.50 to the Motor Vehicle Accident Fund, N$0.50 to general government revenue, and N$0.50 is allocated to the National Energy Fund.
The remaining N$19 to N$21 per litre covers the actual fuel.
Motorists are now paying more for the fuel itself but temporarily less in levies, offering households some relief amid the increase.
“All levies are cut by 50% for the next three months. These levies are also quoted in the petroleum products act,” ministry of industries, mines and energy Ten Hasheela told Namibia Business Review yesterday.
BEFORE THE GOVERNMENT’S HELPING HAND
Before the levy cut, motorists were paying about N$5 per litre in levies and taxes. Of this, roughly N$2.00 went to road maintenance, N$1.00 to the Motor Vehicle Accident Fund, N$1.00 to general government revenue, and N$1.00 to the National Energy Fund, which helps stabilise fuel prices. Out of every litre bought, around N$14 to N$15 went to actual fuel and import costs, meaning roughly a quarter of the pump price was for levies rather than fuel itself.
CABINET STEPS IN TO CUSHION CONSUMERS
To provide further relief, the Cabinet deliberated on the situation and resolved to temporarily cut all fuel levies by 50 percent for the next three months, from April to June 2026.
This reduces levies from about N$5 per litre to roughly N$2.50 per litre, giving motorists some respite while ensuring fuel supply remains secure.
Minister of Industries, Mines and Energy Modestus Amutse said this measure is necessitated due to the high price volatility of petroleum products, which resulted from the ongoing geopolitical tensions in the Middle East.
“Based on the outcomes of the preceding input factors and other parameters considered within the fuel pricing model, the pricing model the Cabinet has resolved to temporarily reduce the number of levies imposed on fuel by 50% for three (3) months, with effect from April to June 2026,” he said.
WHY PRICES ARE RISING
The ministry said the increase is driven by global factors beyond Namibia’s control. International oil prices surged in March due to rising geopolitical tensions in the Middle East, particularly involving the United States, Israel, and Iran. Concerns over supply disruptions and key shipping routes pushed up oil prices and transport costs. The weakening of the Namibia dollar has also made imported fuel more expensive. Because Namibia imports all its refined petroleum products, local prices are directly exposed to global shocks.
WHAT IT MEANS FOR MOTORISTS
Even with the levy cut and National Energy Fund support, consumers will still pay more at the pump this month. Without the intervention, the increase could have been significantly higher.
Independent Patriots for Change (IPC) member of parliament and shadow minister of International Relations and Trade Rodney Cloete said Namibia’s fuel prices are controlled by a network.
“Namibians are being asked to pay N$4.00 more per litre of diesel while the fuel supply chain is controlled by a convinced bribery entity paying N$0.4 per litre for state storage,” he said.
He added “The government absorbs N$500 million from the National Energy Fund while N$660 million per year in the National Oil Storage Facility levy goes unaudited. Every litre Namibians buy enriches the same network that is capturing our oil future.”
Prime Minister Elijah Ngurare questioned why Cloete did not make reference to the war in the Middle East as cause for fuel price escalation.
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