The Zimbabwe Energy Regulatory Authority (ZERA) has announced fuel price adjustments for March 2025, with diesel prices decreasing while petrol prices have risen.
By Ryan Chigoche
Diesel prices dropped by 3%, from US$1.58 in February to US$1.54 per litre, mainly due to fluctuating global oil prices and inconsistent demand. Meanwhile, petrol prices increased by 1% to US$1.55 per litre, up from US$1.53, largely driven by changes in ethanol blending ratios.
The decline in diesel prices comes as a relief to industries that rely heavily on the fuel, particularly mining companies, which use diesel-powered generators as backups during frequent electricity outages.
Many mining operations, especially in remote areas, face erratic power supplies and depend on diesel to maintain productivity. A reduction in diesel costs could slightly ease operational expenses for the sector, which is already grappling with high energy costs and foreign currency shortages.
The rise in petrol prices is linked to the reduction of the mandatory ethanol blend ratio from 15% to 10%. This adjustment follows routine maintenance by Zimbabwe’s major ethanol producers, Green Fuel in Chisumbanje and Tongaat Hulett Zimbabwe in Chiredzi, which has disrupted ethanol supply. A similar trend has been observed in previous years, with ethanol blending ratios sometimes dropping as low as 5% between February and April.
Since ethanol is cheaper than pure fuel, lowering its proportion in the blend increases the overall cost of petrol production, contributing to the price hike.
Additionally, international petrol prices rose between January 31 and February 27, 2025, amid ongoing geopolitical tensions. Russia’s continued Western sanctions have led to voluntary oil production cuts aimed at stabilizing global prices. In response, Russia has increased exports to Asian markets like China and India, forming new trade agreements with non-Western nations to offset its restricted access to Western markets.
