Due to the existing shortage of US currency, petrol prices in Tanzania have surged by 17%, resulting in higher expenses for drivers at the fuel pump. The increase in petrol costs can be attributed to difficulties in obtaining US Dollars, which have impacted the importation of petroleum products. As a consequence, price caps for gasoline and diesel have been raised to cope with the effects of the scarcity.
In response to the higher prices in neighboring Kenya, many Kenyan drivers have been crossing the Tanzanian border to find more affordable fuel options. This trend has led to an influx of customers at Tanzanian petrol stations seeking cheaper fuel alternatives.
As of August 2, 2023, the Energy and Water Utilities Regulatory Authority (Ewura) has announced the new cap prices for petroleum products. Retail gasoline prices for fuel imported through the port of Dar es Salaam have increased to Sh3,199 per liter from Sh2,736 per liter the previous month. Diesel prices have also risen from Sh2,544 to Sh2,935 per liter, while kerosene prices have slightly decreased from Sh2,829 to Sh2,668 per liter.
Dr. James Mwainyekule, the director general of Ewura, stated that the price changes in August 2023 are mainly due to challenges in obtaining US Dollars and fluctuations in the fuel levy and global petroleum product prices, as well as premiums in the importation of petroleum products.
The surge in petrol prices in Tanzania has attracted Kenyan drivers due to the considerable price difference. According to statistics from GlobalPetrolPrices.com, a liter of gasoline costs $1.119 in Tanzania compared to $1.398 in Kenya, which is the highest price in the East African region. Similarly, a liter of diesel costs $1.04 in Tanzania and $1.287 in Kenya, again with Kenya having the highest price in the region. This indicates that Kenyan automobile and bodaboda riders could save $0.247 per liter by refueling in Tanzania.
As of the current situation, petrol prices in Tanzania stand at $1.376 per liter, while in Kenya, they are $1.303 per liter.