Pain at the pump as Zimbabwe hikes fuel prices amid shortage

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FILE PHOTO: A petrol attendant fuels a car at a filling station in Harare, Zimbabwe, January 28, 2019, REUTERS/Philimon Bulawayo/File Photo

Zimbabwe has increased the price of petrol and diesel by up to 26 percent after the finance minister raised import tax on fuel last week.

FILE PHOTO: A petrol attendant fuels a car at a filling station in Harare, Zimbabwe, January 28, 2019, REUTERS/Philimon Bulawayo/File Photo

The move is likely to pile pressure on Zimbabweans as the cost of living soars with citizens already dealing with triple digit inflation.

Prices of basic goods and services have more than doubled since June, when the government renamed the RTGS currency as the Zimbabwe dollar, which has been sliding in value amid widespread shortages, including power, fuel and U.S. dollars.

That has stirred memories among an increasingly impoverished population of economic chaos a decade ago, when rampant money-printing fueled hyperinflation and forced the country to abandon its currency.

In a statement published on Sunday, the Zimbabwe Energy Regulatory Authority said petrol would now cost 9.01 Zimbabwe dollars from 7.55. Diesel would cost 9.06 Zimbabwe dollars, a 26 percent increase.

Fuel prices have been increased four times since June and by more than 500 percent this year, as the value of the local currency has slid.

But fuel shortages remain, with motorists spending hours queuing at the pumps.

Demand for fuel has also gone up as businesses use diesel generators due to 18-hour electricity cuts.

The government is trying to end subsidies by raising the price of fuel and electricity tariffs and put its finances on a strong footing, but that has unleashed inflation, eroding salaries and angering unions.

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