Malawi lifts fuel prices 25 pct on high oil costs

LILONGWE (Reuters) - Malawi fuel pump prices increased by around 25 percent following sharp increases in global oil prices, the Malawi Energy Regulatory Authority said on Monday.

It said the price of petrol would increase to 251.20 Malawi kwacha a litre from 200.90 Malawi kwatcha. The diesel price rises to 234.50 kwacha a litre from 187.20 kwacha.

Finance Minister Goodall Gondwe told Reuters the adjustment was overdue and may impact an expected slowdown in inflation this year.

"The increase was long overdue because we expect petroleum imports to rise from $178 million in 2007 to $200 million in 2008 and 2009 respectively. This could moderate the desired deceleration of inflation," he said.

The government and the International Monetary Fund have projected annual inflation for 2008/09 at 6.5 percent. It measured 8.1 percent in April, marginally slower than in March after accelerating from 7.7 percent in January on high oil prices.

The fuel price increase was the second this year, after a 5 percent rise in January.