The government, last evening, announced an increase on pump prices of both petrol and diesel.

Pump prices for Premium Super have increased from Rwf 952 to Rwf 965 per litre and Diesel rose from Rwf 946 to Rwf 958 per litre.

The increase, announced by the Minister of Trade and Industry, Monique Nsanzabaganwa, while addressing journalists, represents 2.7% and was described as a ‘modest increment.’

"The rise in prices has been caused by the increase in international oil prices globally since December last year,” the Minister said.

She added that international oil prices are speculative in nature and hence any change in the global economic environment will always affect the prices of oil.

Nsanzabaganwa pointed out that the fall of the US dollar against both the Euro and Pound Sterling during the past four months has resulted into the hike of the crude oil prices because the dollar is important to the price of oil since it’s priced in US currency.

She also added that China’s economic growth has been a key driver of the oil price because so much of the development there is dependent on large amounts of commodity hence an increase in oil prices.

"Rwanda being an oil importing country has also been affected by this causing the increase of fuel prices,” she noted.

The minister explained that currently the prices have increased by 5 percent per cubic metre on international market and this implies approximately Rwf 21.9 per litre over the month of December last year.

"This constant rise continues to pose a big problem as well on the pricing of locally consumed petroleum products,” she said.

Last December 2010 witnessed the highest oil price increase where the international crude oil prices generally increased by 10 percent.

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