Fuel prices in Ethiopia surged, with gasoline rising to 112.67 birr per liter, while both diesel and kerosene reached 107.93 birr, and jet fuel hit 113.20 birr. These new rates are effective immediately and reflect the latest in a series of price adjustments as the government reduces fuel subsidies, bringing prices closer to market rates amid economic pressures.
Compared to the previous adjustment on January 7, 2025, these prices show significant increases. Gasoline rose by 11.20 birr from 101.47 birr (+11.03%), diesel and kerosene both saw an increase of 8.95 birr from 98.98 birr (+9.04%), and jet fuel went up by 3.64 birr from 109.56 birr (+3.32%).
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In January, a partial rollback of subsidies left gasoline at 15.81 birr below the projected unsubsidized rate of 117.28 birr per liter. With today’s price increase, that gap has narrowed to just 4.61 birr.
The prices for diesel and kerosene, now both priced at 107.93 birr, appear to reflect a strategic move to simplify pricing for both household and industrial consumers. Jet fuel, at 113.20 birr, experienced the smallest increase, which aligns with its specialized market demand.
Historically, Ethiopia’s fuel subsidies, costing the government around 100 billion birr annually, have kept prices well below regional averages, such as Uganda’s 177 birr and Kenya’s 176 birr for gasoline. However, this latest price hike signals a shift towards fiscal sustainability. Prime Minister Abiy Ahmed (PhD) recently shared with parliament that the government had subsidized fuel by 28 to 30 birr per liter this fiscal year, at an estimated cost of over 72 billion birr. The new rates reflect a significant reduction in these subsidies.
While the Ministry of Trade and Regional Integration has not yet commented, analysts point to global oil price volatility and a depreciating birr, now pegged at roughly 126 birr to the US dollar, as key factors behind the price hikes. Despite rising from 0.80 USD per liter in January to 0.89 USD today, Ethiopia’s fuel prices remain below the global average of 1.26 USD per liter.
Source: Birrmetrics
