Fuel hike lands hard as inflation pressures build
Lewanika Timothy | Wednesday April 1, 2026 06:00
The Botswana Energy Regulatory Authority (BERA) on Friday announced it raised the retail price of unleaded petrol 95 by P5.05 thebe per litre, diesel by P8.77 thebe, and illuminating paraffin by P1.5 thebe. The increase comes at a time when consumers are already under pressure, raising the likelihood of a broad based rise in prices across the economy in the coming weeks. Diesel, which is a key input in public transport, logistics and agriculture, saw the steepest adjustment, signalling immediate pressure on commuter fares and the cost of moving goods.
Operators are expected to pass on the increase to consumers, tightening already strained household budgets. BERA attributed the adjustment to sharp increases in global oil prices, driven by geopolitical instability in the Middle East. “Average Brent crude oil prices rose sharply between February 2026 and March 2026... reaching highs of US$119.50 per barrel, levels last recorded four years ago,” said the Authority headed by CEO Dr. Never Tshabang. The spike follows disruptions in key shipping routes and concerns over tanker movements, which have driven volatility in global oil markets. “International prices of Unleaded Petrol 95 rose by 59.7% diesel prices increased by 90.8% while illuminating paraffin rose by 110.9%,” BERA added.
The developments leave Botswana exposed as a price taker, with local fuel prices adjusting in line with international trends. “Botswana is a price taker and therefore has no influence on international oil price drivers,” the Authority said. The impact is expected to filter quickly through the economy. Fuel sits at the centre of economic activity affecting transport, food distribution and production costs. As these costs rise, businesses typically pass them on to consumers, triggering a chain reaction of price increases. The latest hike comes just weeks after data showed a slowdown in food inflation, offering brief relief to households. Statistics Botswana reported that the annual rate of increase in food and non-alcoholic beverages eased to 5.4 percent in February, down from 6.1 percent in January, largely due to slower increases in vegetable and meat prices. However, other food categories continued to show upward pressure, with oils and fats rising by 8.1 percent and uncategorised food items increasing by 11%. That relief now appears short-lived.
Fuel costs are a key driver of food prices, particularly in a country where goods are transported over long distances. As transport costs rise, so too does the cost of getting food to market, placing upward pressure on retail prices.The adjustment also comes against a backdrop of broader inflation risks. Government is considering increases in electricity tariffs, while pressure is mounting for adjustments in commuter fares both of which would add to the cost burden facing households. The Bank of Botswana had already projected a rise in inflation this year, forecasting an average of 5.3 percent, up from 2.67 percent in 2025. The latest fuel increase is likely to accelerate that movement