Africa-Press – Angola. The increase in the price of diesel in 2024 resulted in an overall reduction in the subsidy of around USD 400 million, although part of these gains were affected by the devaluation of the Kwanza.
Subsidies on diesel and gasoline prices cost the State coffers USD 2.7 billion (around Kz 2.3 trillion) in 2024, a reduction of 12.9% compared to the USD 3.1 billion (Kz 2.1 trillion) recorded in 2023, according to Expansão calculations based on data published by the State Asset and Participation Management Institute (IGAPE).
The increase in diesel prices in 2024 resulted in an overall reduction in the subsidy of approximately USD 400 million, although part of these gains were affected by the devaluation of the kwanza. Last year, the price of gasoline remained stable, while diesel prices increased significantly, rising from 135 kwanza/liter to 200 kwanza. This change had a direct impact on the quantity of diesel sold in the country, which fell from 3.0 billion metric tons in 2023 to 2.6 billion in 2024.
Regarding gasoline, consumption remained stable, despite a slight reduction: in 2023, 1.37 billion metric tons were distributed, while last year 1.35 billion metric tons were recorded.
In total, Angola spent almost 8.2 billion Kz on fuel subsidies between 2021 and 2024, more than the Government spent on Education or Health expenses in the same period (7.7 billion Kz), according to calculations by Expansão based on data from the Ministry of Finance and the General State Account.
Since July 4th, each liter of diesel has cost 400 Kz, which represents an increase of 33% compared to the 300 Kz previously charged.
This is the third increase in the price of diesel, in what is the second wave of gradual withdrawal of fuel subsidies, which began on June 23, 2023 (the first was in 2016), with the price of gasoline rising from 160 Kz to 300 Kz. In April 2024, the price of a liter of diesel rose from 135 Kz to 200 Kz, a year later (March 24) it grew 50% to 300 Kz and then another 33% to 400 Kz.
How the grant works
Fuel import costs in Angola are fully borne by Sonangol, which has been penalized by the way the state subsidy on prices is calculated, since the State does not pay the oil company directly at the end of each financial year and postpones the settlement of accounts until the tax payment stage.
This subsidy scheme harms Sonangol because the annual amount it receives from the State in fuel subsidies is normally greater than the amount it would have to pay in taxes resulting from its activity.
Sonangol itself admits that the subsidy issue needs to be addressed to improve the company’s performance. “There is a very important issue related to fuel subsidies; this issue needs to be overcome” due to the impacts of the differential between the price at which fuels are imported and the price at which they are sold, resulting in significant losses for the company,” said Baltazar Miguel, the national oil company’s director and CFO, in August 2024. He also admitted that “it is more difficult to find investors who will invest in a company that has these issues unresolved.”
In 2020, Presidential Decree 283/20 of October 27 was approved. Article 8 of this decree establishes that market prices are set monthly based on import or export parity, as applicable, through the application of the Flexible Price Adjustment Mechanism (MFA). Because this measure will be subject to challenge, as has been seen every time gasoline or diesel prices have been increased, the end of state subsidies has been repeatedly postponed. EXPANSIONMonday, October 6 , 2025
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Wednesday, October 1, 2025, 6:09 PM
Fuel subsidies cost the state USD 2.7 billion last year
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Fuel subsidies cost the state USD 2.7 billion last year
The increase in the price of diesel in 2024 resulted in an overall reduction in the subsidy of around USD 400 million, although part of these gains were affected by the devaluation of the Kwanza.
Subsidies on diesel and gasoline prices cost the State coffers USD 2.7 billion (around Kz 2.3 trillion) in 2024, a reduction of 12.9% compared to the USD 3.1 billion (Kz 2.1 trillion) recorded in 2023, according to Expansão calculations based on data published by the State Asset and Participation Management Institute (IGAPE).
The increase in diesel prices in 2024 resulted in an overall reduction in the subsidy of approximately USD 400 million, although part of these gains were affected by the devaluation of the kwanza. Last year, the price of gasoline remained stable, while diesel prices increased significantly, rising from 135 kwanza/liter to 200 kwanza. This change had a direct impact on the quantity of diesel sold in the country, which fell from 3.0 billion metric tons in 2023 to 2.6 billion in 2024.
Regarding gasoline, consumption remained stable, despite a slight reduction: in 2023, 1.37 billion metric tons were distributed, while last year 1.35 billion metric tons were recorded.
In total, Angola spent almost 8.2 billion Kz on fuel subsidies between 2021 and 2024, more than the Government spent on Education or Health expenses in the same period (7.7 billion Kz), according to calculations by Expansão based on data from the Ministry of Finance and the General State Account.
Since July 4th, each liter of diesel has cost 400 Kz, which represents an increase of 33% compared to the 300 Kz previously charged.
This is the third increase in the price of diesel, in what is the second wave of gradual withdrawal of fuel subsidies, which began on June 23, 2023 (the first was in 2016), with the price of gasoline rising from 160 Kz to 300 Kz. In April 2024, the price of a liter of diesel rose from 135 Kz to 200 Kz, a year later (March 24) it grew 50% to 300 Kz and then another 33% to 400 Kz.
How the grant works
Fuel import costs in Angola are fully borne by Sonangol, which has been penalized by the way the state subsidy on prices is calculated, since the State does not pay the oil company directly at the end of each financial year and postpones the settlement of accounts until the tax payment stage.
This subsidy scheme harms Sonangol because the annual amount it receives from the State in fuel subsidies is normally greater than the amount it would have to pay in taxes resulting from its activity.
Sonangol itself admits that the subsidy issue needs to be addressed to improve the company’s performance. “There is a very important issue related to fuel subsidies; this issue needs to be overcome” due to the impacts of the differential between the price at which fuels are imported and the price at which they are sold, resulting in significant losses for the company,” said Baltazar Miguel, the national oil company’s director and CFO, in August 2024. He also admitted that “it is more difficult to find investors who will invest in a company that has these issues unresolved.”
In 2020, Presidential Decree 283/20 of October 27 was approved. Article 8 of this decree establishes that market prices are set monthly based on import or export parity, as applicable, through the application of the Flexible Price Adjustment Mechanism (MFA). Because this measure will be subject to challenge, as has been seen every time gasoline or diesel prices have been increased, the end of state subsidies has been repeatedly postponed.
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