Tanzania’s energy regulator lowered maximum retail prices for diesel and kerosene early January but marginally raised the limit for petrol to reflect changes in global energy costs, Standard Digital reported.
The energy regulator announced that retail prices for diesel and kerosene have decreased by 3.68% and 2.11% respectively to provide huge relief to the transport industry and domestic users. Furthermore, the price for petrol price has slightly increased by 0.01%, according to The Exchange.
Kerosene is widely consumed for heating and lighting in Tanzania, while diesel is mostly used by the transport and energy sectors. Therefore, fuel dominates import bill in Tanzania and its prices have a big impact on the inflation rate, which rose to 4.8% in November up from 4.5% year-on-year in October, according to the National Bureau of Statistics.
Tanzania as a net importer of fuel has benefitted from a large fall in the global price of oil since mid-2014 as it led to reduced fuel pump prices which meant more disposable income for consumers and reduced costs for producers. Yet, fuel prices are set to rise after the Organization of the Petroleum Exporting Countries (OPEC) agreed a deal to cut production late last year. OPEC agreed to cut production by about 1.2mb/d, or about 4.5% of current production, to 32.5mb/d.