By Felicity Guta<\/p>\n\n\n\n
When protests erupt in Tehran, bread prices rise in Mutare. That is the reality of an interconnected global economy where political instability in the Middle East reverberates across distant nations like Zimbabwe. Recent discussions hosted by Atlas Network through the Freedom Worldwide webinar, led by Tom G. Palmer alongside Mohamad Machine-Chian, highlighted how governance and liberty shape economic resilience. Yet for Zimbabwe, the most immediate consequence of instability in Iran is felt at the fuel pump.<\/p>\n\n\n\n
Iran remains a significant player in global energy production. Any uncertainty in its political landscape disrupts supply expectations, rattles investor confidence, and pushes oil prices upward. Zimbabwe, which imports all of its petroleum, is acutely vulnerable to such shocks. Rising global oil prices translate directly into higher import costs, which fuel suppliers pass on to consumers. Bread, for example, has already risen from $1 to $1.10, a small but telling indicator of how fuel costs ripple through the economy.<\/p>\n\n\n\n
But Zimbabwe\u2019s pain is not only imported \u2014 it is amplified by domestic policy. Government levies and taxes on fuel are excessive, effectively taxing ordinary citizens twice: once through direct fuel costs and again through inflationary knock\u2011on effects. Instead of cushioning citizens from global volatility, policy choices magnify the burden. The ethanol blending program, introduced as a supposed stabilizer, has failed to deliver meaningful relief. Despite mandatory blending, fuel prices remain stubbornly high, proving that the scheme has become symbolic rather than practical.<\/p>\n\n\n\n
Recent evidence makes the deception clear. At the port of Beira, the Free On Board (FOB) price of petrol sits at approximately $1.09 per liter. Yet the unit price of ethanol supplied by Green Fuel Ltd is $1.10 per liter \u2014 higher than imported petrol. Globally, fuel ethanol prices range between $0.50 and $0.70 per liter, with Gulf benchmarks around $0.50 and Brazilian FOB Santos prices at $0.56\u2013$0.60. In Zimbabwe, ethanol has become a bloating agent that inflates the price of fuel. Instead of lowering costs, it raises them policy as a get\u2011rich\u2011quick scheme for a monopoly rather than a shield for citizens.<\/p>\n\n\n\n
The government\u2019s claim that blending saves foreign currency collapses under scrutiny. If Green Fuel Ltd is demanding payment in USD rather than the local ZiG, then Zimbabwe is not saving forex at all \u2014 it is merely redirecting hard currency outflows from foreign oil companies to a domestic private entity. This is not sovereignty; it is crony capitalism. Zimbabwe now consistently ranks as having the most expensive fuel in the SADC region, with prices hitting an astronomical $2.17 per liter. Every Zimbabwean, whether they own a vehicle or not, is paying a \u201cblending tax\u201d daily through higher transport fares, food costs, and inflation.<\/p>\n\n\n\n
The monopoly held by Green Fuel Ltd, linked to Billy Rautenbach, is a textbook case of state\u2011enabled wealth transfer from the public to the elite. By banning the sale of unblended fuel, government eliminated consumer choice and created a captive market. In a free market, if ethanol were more expensive than petrol, no company would buy it and no motorist would use it. The only way to sustain such an irrational model is through legislation \u2014 a brute force policy that institutionalizes economic plunder.<\/p>\n\n\n\n
True energy security would involve a diversified energy mix, competitive markets, and innovation. Instead, Zimbabwe has tied its transport sector to the production capacity and pricing whims of one company. A drought in the Lowveld or a technical failure at Chisumbanje could paralyze the entire country. We have traded the risks of the global oil market for the risks of a domestic monopoly, and we are paying a premium for the privilege.<\/p>\n\n\n\n
The webinar\u2019s emphasis on institutions and economic freedom is particularly relevant here. Zimbabwe\u2019s vulnerability to external shocks underscores the urgent need for stronger domestic policies. Cutting fuel taxes, dismantling mandatory blending, and restoring consumer choice would be immediate steps toward relief. Longer\u2011term resilience requires diversified energy sources, transparent governance, and market\u2011oriented reforms that reduce dependency on volatile oil markets.<\/p>\n\n\n\n
Equally important is inclusive participation in reform. Empowering citizens to demand transparency and accountability is not just a democratic imperative \u2014 it is an economic necessity. A stable, participatory governance framework is the foundation for shielding livelihoods from global turbulence.<\/p>\n\n\n\n
In conclusion, Zimbabwe cannot control Middle Eastern politics, but it can control how resilient its institutions are to external shocks. Political instability in Iran may seem distant, yet its effects are felt sharply in Zimbabwe\u2019s economy, especially in fuel pricing and inflation. The path forward lies in cutting unnecessary burdens like fuel taxes, dismantling ineffective policies such as ethanol blending, and building institutions that prioritize citizens over revenue. Anything less is a betrayal of the national interest and a continued endorsement of economic plunder.<\/p>\n","protected":false},"excerpt":{"rendered":"
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