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Fuel is a critical component of the country’s day-to-day business. Fuel supply — availability or shortages — affect the socio-economic and political functions of the country. It affects everything.

In the past, fuel prices in Zimbabwe were affected upwards or downwards by the international price market, but of late, a new dimension — that is the currency exchange rate — has become the main factor. What makes it worse is that fuel dealers are fond of using a currency exchange rate based on the parallel market and not the interbank official rate.

Whereas the international market price changes were not that sporadic and high, the parallel market rate tends to be sporadic, sharp and cruel.

There is need, therefore, for Government to establish a fuel stabilisation fund in order to cushion consumers from sharp and shocking price hikes.

While the Reserve Bank of Zimbabwe will stabilise fuel prices by maintaining the foreign currency exchange rate for fuel for the next two weeks to minimise price fluctuations, a long-term solution in the form of a stabilisation fund is the real deal.

It is encouraging that the newly-appointed Energy and Power Development Minister Fortune Chasi is seized with the matter and supports the idea of establishing the stabilisation fund. Stability is very important and allows proper and decent planning.

It is important to understand that currently, the price changes are on the upward trend and more significant than the price changes caused by the fluctuations on the  international fuel market. There seems to be no sign of downward pricing trends, for now.

Hence the long-term solution of establishing a Fuel Stabilisation Fund which will act as a subsidy to cushion consumers from fuel price increases, is needed today and not tomorrow. The earlier it is put in place the better and the minimal the damage it will inflict to the economy of the country.

It is known fact that RBZ had been providing foreign currency for fuel procurement even after the parity between the US$ and the bond note had been removed, but still fuel prices remained a problem in the country. To that end there is no explanation other than that the fuel dealers were not honest and sincere.

This put RBZ under immense pressure and plunged the nation into anxiety. The system was changed recently and the interbank rate is now used to buy forex. Still, the fuel dealers seem to want to go out of the interbank rate, inexplicably opting for the parallel market.

The net effect of the fuel situation has been panic buying by consumers because there is too much uncertainty and too much speculation on the future.

And, generally, the fuel supply situation remains constrained due to panic buying on the part of consumers and also the fact that not all service stations have fuel at any one time. On the other hand, some fuel retailers make unilateral increases to unreasonable levels like what had happened in the recent past. This triggered panic buying.

It goes without saying that the Fuel Stabilisation Fund is the solution and that once established, it will bring sanity and stability to sector and the country. The fuel sector indeed needs a permanent solution, today not tomorrow.

All and sundry should support the Government and the RBZ come up with the fund. The fuel dealers must also be disciplined. They must also play ball. They must understand the importance of their sector to the nation. All will be well, should the fuel sector also play its good part. The fuel sector must have goodwill to the country.