The Energy and Water Utilities Regulatory Authority (EWURA) raised the price of petrol 5.51 percent and increased the price of diesel 6.3 percent. Kerosene prices were raised 5.3 percent in the latest price caps with effect from Monday.

"The price increases have been caused by a rise in the petroleum products prices in the world market and depreciation of the Tanzanian shilling compared to the US dollar - the currency in which purchases of products in the international oil market are made," EWURA director general Haruna Masebu said in a public notice.

After the adjustments, in the commercial capital Dar es Salaam a litre of petrol will go for 2,114 shillings ($1.31) a litre of diesel will sell at 2,031 shillings, while kerosene will sell at 2,005 shillings per litre.

Masebu said the shilling has depreciated 2.96 percent, while oil prices increased 5.42 percent during the period under review.

The energy regulator lowered fuel prices in its previous review on Aug. 3 based on a new formula in line with a government pledge in its 2011/12 budget in June to cut prices to tackle the rising cost of living.

The price cuts caused a fuel shortage in the country, prompting the regulator to suspend BP Tanzania's licence for three months amid accusations oil companies were hoarding supplies to create an artificial shortage.

Fuel prices in Tanzania, like its other east African neighbours have been rising in recent months, and have had a significant impact on the rate of inflation in the region's second-largest economy.

On Sunday, Kenya increased pump prices for petrol, diesel and kerosene for mid-August to mid-September, also citing a weaker local currency and slightly higher international fuel costs.

Copyright Reuters, 2011