Malawi: Fuel prices shoot up by 25 percent

  1. Posted on Tuesday 17 June 2008 - 11:22
    Sam Banda Junior
    Image of Sam Banda Junior
    Sam Banda, AfricaNews reporter in Blantyre, Malawi
    Malawi Energy Regulatory Authority (Mera) has announced an increase of 25 percent for petrol, diesel and paraffin as fuel prices on Sunday went up due to pressure from the international market. Analysts have said this is bound to increase the cost of living.
    fuel_oil_petrol
    According to a press statement from the country’s fuel regulator, the price of petrol is now selling at 251.20 Malawi kwacha ($1.79) a litre from 200.90 Malawi kwacha (US$1.43) whereas the diesel price goes up to 234.50 Malawi kwacha (US$ 1.65) a litre from 187.20 Malawi Kwacha(US$ 1.33). The price of paraffin is now at 165.30 Malawi Kwacha (US$ 1.18).

    As of Friday Crude oil was trading at US$ 138 per barrel on the international market.

    The press statement from Mera noted that the escalating prices for oil on the international market due to geographical factors, the weakening of the US dollar and high demand for fuel among others were responsible for the fuel hike.

    According to Monday’s report of the country’s local daily of the Daily Times, is said in April, 2008 the average Freight On Board(FOB) prices per metric tonne for petrol, diesel and paraffin were noted to be at US$ 988.78, US$ 1,083.48 and US$ 1,119.36 respectively.

    The Southern African nation’s Minister of Finance Goodall Gondwe said that the adjustment was overdue and may impact an expected slowdown in inflation this year.

    "The increase was long overdue because we expect petroleum imports to rise from $178 million in 2007 to $200 million in 2008 and 2009 respectively. This could moderate the desired deceleration of inflation," Gondwe told Reuters on Monday.

    The government and the International Monetary Fund have projected annual inflation for 2008/09 at 6.5 percent. It measured 8.1 percent in April, marginally slower than in March after accelerating from 7.7 percent in January on high oil prices.

    This is the second time fuel prices have gone up in the country following another 5 percent increase in January.

    Meanwhile the rate at which the price of goods and services increase has slowed down in the country to 7.9 percent from 8.1 percent in April, data from the country’s National Statistical Office(NSO) showed.

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