Zambia Has Increased the Price of Fuel After Removing Subsidies on Petroleum Products

LUSAKA, (Reuters) – Zambia has increased the price of fuel after removing subsidies on petroleum products to reflect the correct price of the commodity, the energy regulator said on Thursday.

The pump price of petrol was increased to 21.16 kwacha ($1.29) per litre from 17.62 per litre while diesel price rose to 20.15 kwacha per litre from 15.59 per litre, the Energy Regulation Board said in a statement.

“This is following the announcement by the government that fuel subsidies will be removed so as to migrate to cost reflective pricing,” it said.

The current pump prices have been kept artificially low since December 2019 despite movements in international oil prices and depreciation of the kwacha, the regulator said.

Zambia Finance Minister Situmbeko Musokotwane said earlier this month that an International Monetary Fund programme to try to get the country’s global debt mountain back under control would include removing unsustainable subsidies on energy and agriculture.

The IMF and Zambia this month reached a staff level agreement on a $1.4 billion, three-year extended credit facility.

($1 = 16.3642 Zambian kwachas)

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