By The Forum

Fuel prices have risen sharply again, just four months after the last adjustment, with the Malawi Energy Regulatory Authority (MERA) announcing increases of more than 40 percent for both petrol and diesel.

In a statement dated January 19, 2026, MERA Board Chairperson Lucas Kondowe said the petrol pump price has increased from MWK3,499 to MWK4,965, representing a 41.9 percent rise. Diesel has gone up from MWK3,500 to MWK4,945, an increase of 41.29 percent.

“By law, all operators are required to sell petroleum products at prices not exceeding the approved regulated maximum pump prices,” Kondowe said.

MERA attributed the increase to the reintroduction of the Automatic Pricing Mechanism (APM), under which fuel prices are adjusted when changes in model parameters exceed a ±5 percent threshold.

“Under the APM, petrol and diesel qualify for price revision for the month of January 2026, since the landed cost of both products is beyond the ±5 percent trigger band. Therefore, to sustain the importation of petrol and diesel, pump prices have been adjusted upwards,” Kondowe explained.

The APM had been abandoned for the past three years in favour of a fixed pricing regime. However, MERA said the system proved commercially unsustainable, resulting in significant trading losses and fuel importation challenges.

According to the regulator, the fixed pricing regime also affected the government’s ability to remit key levies, including the Road Levy to the Road Fund Administration (RFA) and the Rural Electrification Levy to the Malawi Rural Electrification Programme (MAREP) Fund.

“This led to the deterioration of roads countrywide and delayed implementation of important MAREP projects nationally,” Kondowe said.

He added that artificial fuel pricing created arbitrage opportunities for smugglers, causing the country to lose scarce foreign exchange by subsidising foreign fuel demand and depleting national Strategic Fuel Reserves.

The previous fuel price hike was implemented on October 1, 2025, shortly after the September 16 general elections, ending nearly two years without an adjustment. At the time, MERA said the increase reflected movements in international oil prices and exchange rate fluctuations aimed at stabilising the fuel supply chain while keeping prices cost-reflective.

During the October adjustment, petrol prices rose from MWK2,530 to MWK3,499, a 38.3 percent increase, while diesel prices increased from MWK2,734 to MWK3,500, representing a 28 percent rise.

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