New Fuel prices have been introduced by the Ministry of Trade and Regional Development. The changes are expected to be effective as of the 9th of October at 6:00 in the morning.
In response to escalating global oil prices, the government has maintained the stability of fuel prices over the past two months through subsidies, expending over 35.8 billion birr to alleviate the burden on consumers.
Nevertheless, officials highlight that the current fuel prices in Ethiopia are notably lower than those in neighboring countries, leading to illicit trading activities and smuggling. Consequently, a gradual adjustment in fuel prices is now deemed imperative.
The new strategy entails periodic revisions in fuel prices over the upcoming year, with the government persisting in providing subsidies to mitigate the impact on consumers.
Here's a breakdown of the changes:
Gasoline and Jet Fuel: Prices will increase gradually over the next few months. The government will absorb 75% of the cost, while consumers will pay 25% every three months.
White Diesel and Kerosene: Prices will also increase, but the government will cover 80% of the cost. Consumers will only pay 20% of the price hike.
Light Black Diesel and Heavy Black Diesel: there will be no subsidies for these fuels. Consumers will bear the entire cost of the price increase.
New Prices
Gasoline: 91.14 Birr/Liter
White Diesel: 90.28 Birr/Liter
Kerosene: 90.28 Birr/Liter
Light Black Diesel: 100.20 Birr/Liter
Heavy Black Diesel: 97.67 Birr/Liter
Aircraft Fuel: 77.76 Birr/Liter
Although this adjustment is projected to impose additional costs on consumers, the government has pledged to allocate around 33 billion birr towards subsidies over the ensuing three months, with the total expenditure potentially exceeding 100 billion birr in a year if global oil prices remain steady.
The Ministry of Trade and Regional Development underscored the significance of this adjustment in maintaining market stability and driving economic reform, urging the public to report any unjustifiable price hikes by businesses during the transitional phase.