In Tanzania, the rising cost of fuel has reached unprecedented levels, turning a global oil shock into a potent symbol of the country’s economic and political vulnerabilities. The soaring crude oil prices, driven by geopolitical tensions involving the United States, Israel, and Iran, are now cascading through the economy, inflating transport fares and food costs. This has not only added to the burden on consumers and businesses but has also intensified public anger and scrutiny on domestic policies.
Dar es Salaam has witnessed fuel prices skyrocket to over Sh3,820 per litre ($1.48), a figure that has sent shockwaves through the community. This dramatic rise follows a surge in global oil prices due to disruptions around the Strait of Hormuz, which caused a spike in freight and insurance costs. Although international prices are beginning to stabilize, Tanzania’s domestic adjustments remain slow and uneven, with the wealthy paying a significantly higher percentage of their income for fuel compared to other countries.
Comparatively, petrol in the United States averages at about $1. 03 per litre, while in Great Britain it retails at $1. 95 per litre (Sh5,030).
Tanzania’s fuel costs are particularly high in relation to its economic situation, with Kenyan petrol going for about $1. 40 (Sh3,600) per litre and prices in Uganda and Rwanda ranging between $1. 30–$1.
35 (Sh3,350–Sh3,480). Landlocked countries like Somalia and South Sudan, which depend on Tanzania’s ports, have managed to keep their prices lower than Tanzania’s despite similar challenges.
Government officials maintain that the crisis is largely the result of imported global dynamics. President Samia Suluhu Hassan and Prime Minister Mwigulu Nchemba have emphasized the importance of fiscal restraint, implementing measures such as reducing official motorcades and stricter spending controls. The Ministry of Energy has taken steps to monitor fuel shipments and prevent hoarding, aiming to avert artificial shortages.
However, the situation is not without its challenges. Operators of daladala (commuter buses) in Dar es Salaam and Mwanza have threatened to halt services unless fares are adjusted to accommodate the rising fuel costs. This would not only ground urban mobility but also severely impact the livelihoods of millions who depend on these services. Transport operators, already operating at a loss, are calling for fare adjustments, highlighting the delicate balance between passenger affordability and operator viability.
Parliament is considering various solutions, from fuel subsidies to tax cuts and the wider use of natural gas. The opposition Chadema party has taken a more critical stance, arguing that the crisis is as much a result of domestic policy choices as it is of global shocks. Chadema Vice Chairman John Heche has emphasized the humanitarian dimension of the crisis, calling for a more immediate response to the rising cost of essential goods.
The party’s analysis highlights the significant contribution of taxation to high fuel prices, with nearly one-third of every Sh100 spent on fuel going towards taxes and levies. Chadema’s proposed emergency transition period would involve targeted subsidies, tax relief, and temporary price controls to alleviate the financial strain on citizens. Heche suggests that a 10 per cent tax cut could reduce petrol prices to about Sh3,500, easing the burden on transport costs and food prices.
The conversation has also turned to the management of Tanzania’s strategic fuel reserves. Critics are questioning the rationale behind the significant price increase before the arrival of new, costlier imports. The delay in pricing and lack of transparency have raised concerns about structural or policy failures.
This fuel crisis, marked by rising transportation and food costs, is placing a heavy toll on motorcycle taxi drivers, small merchants, farmers, and low — income households. Employees with fixed incomes, such as teachers and factory workers, are finding their purchasing power stretched even further. The current economic situation is testing the government’s ability to balance fiscal stability with the need for social relief, as decisions over taxes, subsidies, and structural reforms will shape Tanzania’s economic and political future.
Source: Panafricanvisions
Original author: Pan African Visions
