RBZ seals fuel supply deal with Sakunda

The Reserve Bank of Zimbabwe (RBZ) has signed a deal with Sakunda Holdings for the supply of 160 million litres of fuel to nine local fuel companies to avert the impending fuel shortages owing to limited foreign exchange.

The structured fuel facility between the RBZ and Sakunda is expected to ensure smooth fuel supplies during the festive season.

The agreement is supported by a US$24 million dollar letter of credit from a local Pan-African bank, Ecobank.

According to sources within the central bank, the agreement was reached after Sakunda Holdings indicated that they have 250 million litres of fuel in stock, hence there is no need for motorists and the travelling public to panic.

Documents gleaned by ZBC News show that under the structured fuel facility, fuel will be supplied upfront without any nostro account payments but a commitment by the central bank to pay US$4 million weekly to Sakunda Holdings for the two months of December and January.

Sources close to the deal revealed that for the supply of fuel, there are no payments upfront needed, and the arrangement  guarantees the full utilisation of the Beira-Feruka pipeline and availability of fuel at all times.

Ecobank has issued a 360 day differed letter of credit backed by part retention of export proceeds.

According to sources within the bank, the financial institution will get US$2 million monthly.

The deal will also come as a relief to motorists and the travelling public as government has been facing challenges in securing foreign exchange to redeem the fuel.

The structured fuel facility will go a long way in ensuring constant and reliable fuel supplies during the festive season considering the stocks are already in the country which also restores confidence and fuel market stability.