Ethiopia’s Ministry of Trade and Regional Integration has announced revision of fuel prices effective on Friday. The ministry attributed the increase to rising oil prices in the global market.
Based on the latest revision, petroleum products have seen notable increases in retail prices, impacting both consumers and businesses across the country.
Accordingly, the price of gasoline has risen from 91.00 birr per litre in October to 122.53 birr in May—representing a 34.6% increase. Diesel, also referred to as Light Black Naphta, increased from 90.00 birr to 106.77 birr per litre, reflecting an 18.6% rise. Kerosene and White Naphta each saw prices climb from 90.00 birr to 116.49 birr, an increase of 29.4%. Heavy Black Naphta experienced a more modest rise from 104.08 birr to 106.77 birr, amounting to about 2.6%. In contrast, Jet Fuel saw a slight reduction in price, dropping from 113.20 birr per liter in January to 109.56 birr in May.
Based on views from the ruling Prosperity Party, the broader context for these fuel price increases lies in Ethiopia’s gradual phasing out of fuel subsidies, a move that is part of wider economic reforms aimed at liberalizing the economy.
While these measures are intended to reduce fiscal pressure and attract investment, the resulting impact on retail fuel prices has become a source of public concern. As household budgets come under increasing pressure, the economist cautions that without supportive fiscal policies or targeted subsidies for vulnerable populations, the cost of living will continue to rise, potentially leading to broader socio-economic instability.
As of early 2025, Ethiopia’s year-on-year inflation rate remains high. According to the Central Statistics Agency, inflation stood at around 28 percent in March, with food and transport costs as major contributors. Urban households, in particular, are facing increasing financial strain as wages remain largely stagnant while the prices of basic goods and services continue to rise.
MG/abj/APA