The Malawi Energy Regulatory Authority (MERA) has historically adopted Automatic Pricing Mechanism (APM) under which a movement in model parameters increase/decrease of more than 5% triggers an automatic price adjustment. However, in the last three years, this mechanism was abandoned in favour of a fixed pricing regime that proved to be commercially unsustainable.

This led to significant trading losses, resulting in inability to import adequate petroleum products and inability to remit economically important levies like the Road Levy to the Road Fund Administration (RFA) and Rural Electrification Levy to Malawi Rural Electrification Programme (MAREP) Fund. This resulted in the deterioration of roads countrywide, and delayed implementation of important MAREP projects nationally.

Furthermore, the artificial pricing of petroleum products created arbitrage opportunities for smugglers, resulting in the country losing its scarce foreign exchange resources by subsidising foreign product demands, and depletion of important national Strategic Fuel Reserves (SFRs).
Under the APM, petrol and diesel qualify for price revision for the month of January 2026, since the landed cost of both products is beyond the ±5% trigger band. Therefore, to sustain importation of petrol and diesel, pump prices of these petroleum products have been adjusted upwards effective 20th January 2026 as follows:

The current product ruling pump prices are MWK 3,499 for Petrol and MWK 3,500 for Diesel, and the approved prices are MWK 4,965 for Petrol and MWK 4,945 for Diesel, translating into a 41.90% and 41.29% change respectively.

By law, all operators are required to sell petroleum products at prices not exceeding the above approved regulated maximum pump prices.

Lucas Kondowe
BOARD CHAIRPERSON
19th January 2026