Fuel prices fall in Tanzania as $43m subsidy comes into effect
Tanzania has reduced the cost of fuel effective Wednesday following the Tsh100 billion ($43 million) fuel subsidy the government announced last month.
According to the Energy and Water Utilities Regulatory Authority (EWURA), effective Wednesday, the retail price for petrol is Tsh2,994 ($1.28) from 3,303 ($1.42) per litre, diesel Tsh3,126 ($1.34) down from Tsh3,452 ($1.48) per litre, while kerosene prices remain unchanged.
Fuel prices hit new highs in Tanzania
In Dar es Salaam, petrol prices reduced by Tsh306 ($0.13) per litre while diesel prices dropped by Tsh320 ($ 0.14) per litre. In Tanga and Mtwara ports, petrol prices went down by Tsh152 ($0.06) and Tsh282 ($0.12) per litre, respectively.
Diesel prices deepen to Tsh476 ($0.2) per litre for Tanga port and Tsh486 ($0.21) for Mtwara port, Ewura said.
“Oil marketing companies are free to sell their products at a price that gives them a competitive advantage provided that such price does not exceed the price cap and is not below the floor price for the relevant product,” said a statement by Ewura Director-General Modestus Lumato.
Tanzania President holds Cabinet meeting over high fuel prices
On May 10, Energy Minister January Makamba announced a subsidy of Tsh100 billion ($43 million) to take effect from June 1, 2022, so as to reduce the cost of fuel before the start of the new financial year.
Makamba also confirmed that Tanzania is in the final stage of securing loans from the IMF and World Bank to help ease the high cost of living.
Zuhura Yunus, Tanzania’s Director of Presidential Communications, added that, “Following fuel prices acceleration and the high cost of living, Tanzania requested a soft loan of Tsh1.1 billion ($473,000) from the International Monetary Fund (IMF) last month during President Samia Suluhu Hassan talks with Kristalina Georgieva, Managing Director of IMF.”
The IMF team was in Tanzania last month for further talks on the three-year loan.
In July 2021, Tanzania imposed a Tsh100 ($0.043) surcharge on petrol, diesel, and kerosene. This was suspended in February this year to ease rising fuel costs in the country, and the suspension remained in place until May 2022.
According to Makamba, Tanzania lost more than Tsh102 billion ($43.8 million) in revenue over reduced tariffs and tax from fuel.