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FUEL HIKE MUST BE UNDERSTOOD IN THE CONTEXT OF A GLOBAL ENERGY CRISIS

The Editor Zambia

The latest increase in fuel pump prices in Zambia has understandably generated concern among motorists, businesses, and households already dealing with the pressures of the cost of living.

However, the adjustment should not be viewed in isolation because it needs to be understood against the extraordinary disruption taking place in international energy markets and the fiscal measures the government has already employed to cushion consumers.

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Energy expert Bornface Zulu argues that the latest adjustment reflects the reality of a global market in which the price of crude oil and refined petroleum products has been pushed sharply upwards by geopolitical tensions and supply disruptions.

For several months, the Zambian Government deliberately absorbed part of the pressure through the suspension of selected taxes on fuel, including excise duty and Value Added Tax.

That intervention provided consumers with temporary relief, even though it meant that the government surrendered significant revenue.

Mr. Zulu’s argument is that such a measure could not reasonably be expected to continue indefinitely. The government has other obligations, including financing health, education, roads, social protection, and other public services.

At some point, extraordinary tax relief has to be reviewed if public finances are to remain sustainable.
This is precisely why the latest increase should be seen as part of a difficult balancing act rather than simply an arbitrary decision to make motorists pay more.

The experience of the United Kingdom provides a useful illustration of how difficult the international situation has become.

On October 2, the average UK diesel price reached a record £2.0001 per litre, according to figures from the RAC. That represents a 40.5 percent increase since the beginning of the conflict involving Iran in February. The cost of filling a typical 55-litre diesel tank has risen to about £110, approximately £31.70 more than at the end of February. Petrol has also risen sharply.

Britain is hardly a country without resources or sophisticated economic institutions. Yet it, too, is struggling to shield consumers completely from international fuel-market pressures.

Indeed, the British government has already used taxation as a mechanism for cushioning motorists. The UK has maintained a temporary 5 pence-per-litre reduction in fuel duty, which was extended through December 2026.

The authorities have nevertheless planned a gradual restoration of fuel-duty rates, with increases scheduled in September 2026, December 2026, and March 2027.

The comparison is instructive. It demonstrates that even wealthy economies cannot simply decree that fuel prices should remain permanently low when the underlying international cost of petroleum products is rising.

The UK also illustrates another important point: taxation is only one component of the pump price. British motorists currently pay fuel duty as well as 20 percent VAT on most road fuel. The current fuel-duty rate for petrol and diesel is 52.95 pence per litre.

Zambia, therefore, needs a realistic national conversation about fuel pricing. Citizens are entitled to demand relief, but the government must simultaneously ensure that fuel remains available, importers and suppliers can operate sustainably, and public finances are not undermined by subsidies that cannot be maintained.

The temptation whenever pump prices rise is to treat the increase as evidence of government failure. That interpretation ignores the international dimension of the problem.

The current energy shock is affecting transport operators, farmers, manufacturers, logistics companies, and ordinary motorists across continents.

In Britain, concerns over supplies have become serious enough for European countries and the International Energy Agency to consider releasing emergency petroleum reserves.

Zambia cannot insulate itself completely from such developments.
The temporary tax measures provided breathing space. The latest adjustment reflects the need to move towards a more sustainable pricing and fiscal position.

Nobody should pretend that higher fuel prices are painless. They are not. But neither should every increase automatically be portrayed as evidence that the government has abandoned consumers.

The international evidence tells a different story: fuel prices are rising because the world energy market is under exceptional pressure, and governments everywhere are being forced to make difficult choices between consumer relief, supply security and fiscal sustainability.

Zambia is confronting the same global reality.

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