Addis Ababa, (Horn post) Ethiopia’s Ministry of Trade and Continuous Relations announced a new adjustment to fuel prices due to rising global petroleum costs caused by ongoing conflicts in the Middle East. The price changes affect petrol, kerosene, diesel, and aviation fuel, while the government continues to provide partial subsidies to ease the impact on consumers.
According to the Ministry, global petroleum prices surged after February 21, 2018, driven by the war in the Middle East and disrupted supply chains. Key petroleum exports from countries including Saudi Arabia, Kuwait, the United Arab Emirates, and Iraq have been cut due to the closure of the Hormuz Strait, which handles roughly one-fifth of global crude oil traffic.
Ethiopia imports petroleum products such as white diesel, petrol, kerosene, aviation fuel, heavy and light black diesel through a combination of government agreements and international auctions. Under a contract with Kuwait, 60% of white diesel and all aviation fuel will be supplied directly by the Kuwaiti government, while remaining products are sourced through competitive auctions.
The Ministry explained that the premium-based pricing mechanism links domestic fuel costs to the global monthly average. For instance, in February 2018, the global average for Kuwait’s white diesel was $86.03 per barrel, rising to $95.28 including premiums. Supply disruptions have further increased premiums, pushing aviation fuel to $86.33 and white diesel to $92.88 per barrel.
The government has allocated significant subsidies to mitigate the financial burden. For example, the subsidy on white diesel is 71 birr per liter, while petrol receives 32 birr per liter. Without subsidies, domestic prices would reach 234.17 birr per liter for petrol and 174.40 birr for diesel. The current retail prices are:
Petrol: 142.21 birr per liter
Kerosene: 151.39 birr per liter
White diesel: 163.09 birr per liter
Light black diesel: 163.98 birr per liter
Heavy black diesel: 160.68 birr per liter
Aviation fuel: 150.48 birr per liter
Despite the price increases, Ethiopia’s fuel prices remain lower than neighboring countries. Comparatively, petrol costs $1.032 per liter in Ethiopia, versus $1.374 in Kenya, $1.741 in Djibouti, and $1.09 in Tanzania.
The Ministry emphasized that fuel supply remains sufficient, though monitoring teams have been deployed to ensure proper distribution. Priority will be given to government and essential services, including transportation, healthcare, security, electricity and water projects, education institutions, mechanized farms, and critical private development sectors.
The Ministry called on citizens and organizations to cooperate with government distribution efforts during this challenging period to ensure equitable access to fuel.
Prepared by:
Horn Post Staff
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Website: www.hornpost.com
