Senegal Lifts Fuel Prices as Subsidies Strain Government Budget

Last year's surge in oil to alleviate a squeeze on the government's budget led to a second price hike on subsidized fuels.

The price of a liter of diesel went up to 755CFA Francs. Unleaded fuel went from 890 to 980CFA Francs.

The oil minister said that the increase was needed to limit public spending on subsidies.

Initial estimates show that government expenditures on fuel subsidies almost doubled last year. The most recent price hikes should allow for a limit on the cost to be 450 billion CFA Francs, according to the trade minister.

The country is facing a cost of living crisis like many of its neighbors. Food and energy costs have gone up.

Rent subsidies and price caps on many basic goods were included in a relief plan unveiled by the president of Senegal.

The start of oil and gas production may relieve some of the strain on public finances. Crude exports from the country's offshore Sangomar field are expected to start in the second quarter, while a facility for natural gas is expected to come online over the next three months.

Sall says that the economy will grow more than 10%.