September Fuel Price Reviews, Likely to Destabilize Cost Structures

The Energy Regulation Board (ERB) has today announced an upward adjustment in fuel pump prices for the calendar month of September 2025.

The increase is justified with mainly attributing to only two external factors:

1. monthly shake up in Kwacha, showing a 2.5% monthly depreciation levels recorded against the US dollar and
2. A rise in international fuel premiums due to insurance and logistics patterns despite sustaining low prices,

With ERB, it is believed that these two key factors cited as seriously argumenting to this price growth.

However, it is upsetting that Zambia’s heavy dependence on imported petroleum products always make domestic pump prices quite sensitive to shifts or uncertainties in both the exchange rate and global oil market dynamics, especially that we don’t also seem to have enough storage capacities backed by some formidable oil contracts.

Surprisingly, even a modest weakening of the Kwacha now raises the local cost of petrol and diesel differently, while global premiums are seemingly to add some more additional pressure.

This adjustment might be a serious tag of war, deemed necessary to sustain the availability of fuel on the market following market players’ tricks and sales games that were exercised that led to artificial shortages.

However, the upward price band set for this month will have some broad economic effects as follows below:

1. Transport costs are expected to sharply rise, putting pressure on commuters and logistics operators.
2. Households will face higher food and essential commodity prices due to increased distribution costs.
3. Businesses, especially in agriculture, transport, production and the manufacturing, will encounter higher operating expenses, which may negatively impact business and investment competitiveness.

While Zambia’s inflation rate has just recently declined, the latest fuel adjustment may introduce some renewed inflationary pressures in the short term.

It is therefore vital for policymakers to remain focused on stabilizing the currency, exploring alternative energy sources and implementing targeted safety nets to protect vulnerable groups.

Fuel cost centre speaks directly into production and transport costs, which will have cascading effects on key essentials.

The increase in fuel prices deeply reflects external pressures rather than domestic policy choices.

Managing the ripple effects requires shared responsibility consumers adapting to rising costs, businesses reviewing logistics and pricing strategies, and government strengthening forex and energy resilience.