IRIN – A raft of fuel price hikes that will affect agricultural production costs as well as consumer pockets is expected to drive food price inflation in Zambia, where about two-thirds of the population live on US$1 or less a day.

The government has announced an immediate petrol price rise of 15 percent, soon after a 10 percent excise duty on diesel came into effect on 1 January 2010.

According to a World Bank study citing average prices when the oil crisis peaked in 2008, the landlocked country had the highest fuel prices in southern Africa.

With the new hike, petrol in the capital, Lusaka, will cost about US$1.53, an increase of US$0.50, while diesel – primarily used in the mining and agricultural sectors – will now cost about US$1.20 a litre.

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