Cooking fuel prices in Rwanda increase

As crude oil prices soar on the international market hitting an all-time high for the fifth time at $108 (about Frw58,820) a barrel—117 litres, Rwandans are paying more for cooking gas and  kerosene (paraffin).
Gas cylinders on sale at Kisementi in Kigali. (Photo/ J. Mbanda)
Gas cylinders on sale at Kisementi in Kigali. (Photo/ J. Mbanda)

As crude oil prices soar on the international market hitting an all-time high for the fifth time at $108 (about Frw58,820) a barrel—117 litres, Rwandans are paying more for cooking gas and  kerosene (paraffin).

But charcoal that would have been the alternative for many families, is equally expensive. A sack  has increased from Frw4,800 to Frw5,500 in Kigali City.

A mini survey carried out by The New Times at Kobil, Total, SP, KLSS and Merez fuel filling stations in Kigali city indicates that the pump price of kerosene (paraffin) has increased from Frw600 to Frw623.

Last year, Rwandans used to consume kerosene at Frw480 but the price has gone up to Frw623 at several fuel pump stations. While the prices of cooking gas increased too by Frw4,000, on average within two months.

Vincent Karega, state minister for industry and investment promotion—the acting commerce minister partly attributes the increase of kerosene price to lack of subsidises, whereas other fuels including petrol, jet one for aircrafts and diesel are heavily subsidised, paraffin is not.

“Kerosene is not subsides because it has less demand compared to other petroleum products that are used for generating our electricity and running industries,” Karega explained.

Eugène Torero, deputy commissioner general Rwanda Revenue Authority said: ”Fuel importers in Rwanda pay less than 10 per cent tax on oil products. This is the cheapest tax in the region.”

However the minister hastens to say, the increasing world oil prices have a direct effect on the pump and the final consumer prices in the country.

Adding, the gas price too has been affected by the international oil prices, since gas is an oil bi-product. For charcoal, he suspects prices to have increased due to the fact that the demand for timber in the country is higher than the supply as Rwanda has few forests.

Adding: “It’s the reason why timber is imported from neighbouring countries.”

Victor Nduwumwami, country manager of Source Oil company, a local oil importing company also echoed the ministers concerns saying they were forced to increase the pump prices because of the soaring world oil prices.

Paraffin retailers cash in

Retailers are now selling kerosene at Frw1,000 per a litre making a profit of Frw377. The last time fuel prices increased in Rwanda was in January where rose by Frw42, diesel Frw49, while Kerosene was increased by Frw22.

This was due to the recently ended Kenyan post-election violence that vandalised roads and railway lines cutting off supplies to landlocked countries.

Soaring oil prices

International analysts say traders are now investing in commodities to protect themselves against the falling dollar rather than oil.

The dollar has been reaching new lows against the euro and other key currencies since last summer, and was hit again on Friday by a US employment report showing the labour market at its weakest in five years.

Another factor pushing up prices is the decision by producers’ cartel ‘Opec’ to keep output unchanged, despite rising oil demand in China.

The high oil price is making petrol and energy costs more expensive allover the world, putting financial pressure on  businesses and household budgets.

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