When the Energy Regulation Board (ERB) announced the April 2026 fuel prices, the reaction was predictable.
When the Energy Regulation Board (ERB) announced the April 2026 fuel prices, the reaction was predictable.
Petrol up to K27.15.
Diesel jumping to K29.78.
Another increase. Another adjustment. Another strain.
But if you look closely, something doesn’t quite add up.
Because these prices—high as they are—are not the real price of fuel.
They are something else.
They are intervened prices.
A Price… Adjusted by Policy
Behind the scenes, the government made a deliberate move:
- Excise duty suspended
- VAT zero-rated
Not reduced. Not tweaked. Removed—temporarily.
That changes everything.
It means the number you see at the pump is not purely market-driven. It’s a policy-managed outcome, designed to soften the shock coming from global oil markets.
So the real question isn’t just why prices went up.
It’s:
How high would they have gone if nothing was done?
Reversing the Math
To answer that, we work backwards.
Start with what we see today.
Petrol at K27.15.
Diesel at K29.78.
These prices exclude two key components: excise duty and VAT.
So we add them back.
First, excise duty—what used to be part of every litre:
- Petrol: K2.34
- Diesel: K0.75
That takes us to:
- Petrol: K29.49
- Diesel: K30.53
Still not the full picture.
Next comes VAT.
At 16%, applied on top of the total value:
- Petrol rises to roughly K34.20
- Diesel climbs to about K35.40
Now we’re looking at something much closer to reality.
The Price Behind the Price
What emerges is a quiet but powerful insight:
| Fuel Type | At the Pump | Without Intervention | |----------|------------|----------------------| | Petrol | K27.15 | ~K34.20 | | Diesel | K29.78 | ~K35.40 |
The gap is not small.
- Petrol is being held down by about K7 per litre
- Diesel by roughly K5 to K6
That’s not a minor adjustment.
That’s the government stepping in and absorbing part of a global shock.
The Illusion of Stability
This is where things get interesting.
Because on the surface, it looks like:
Prices went up… but not dramatically.
In reality:
Prices should have gone up much more.
What we are seeing is not stability.
It’s controlled pressure.
The kind that builds quietly beneath the surface.
The Cost of Holding the Line
Of course, shielding consumers comes at a cost.
An estimated K1.5 billion in foregone revenue.
That’s money the government is choosing not to collect—for now.
In exchange, it buys:
- Short-term relief
- Slower inflation
- Political and economic breathing space
But it’s a trade-off.
One that cannot hold forever.
A Temporary Buffer
Because the fundamentals haven’t changed.
- Global oil prices are still elevated
- Zambia still imports its fuel
- The exchange rate still matters
This policy doesn’t remove the pressure.
It delays it.
What This Means Going Forward
At some point, one of two things happens:
- Global conditions improve
- Or the tax measures are reversed
Either way, the underlying reality will resurface.
And when it does, the adjustment could feel abrupt.
Final Thought
What we are paying at the pump today is not the full cost of fuel.
It is a number shaped by intervention, timing, and trade-offs.
And when you reverse the math, one thing becomes clear:
The real story isn’t the price we see.
It’s the price being quietly held back.
Because in this moment, Zambia is not just paying for fuel.
It is buying time.
© 2026 Kampamba Shula