In a bid to cushion Malawians from the impact of rising global oil prices emanating from the Middle East crisis, President Peter Mutharika wants to work with the World Bank to midwife emergency support.
The President’s appeal, made during a meeting with World Bank regional programme director for Africa Nathan Belete and incoming division director for Malawi Firas Raad at Sanjika Palace in Blantyre yesterday, comes days after Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha expressed hope that a recent $80 million (about K140 billion) World Bank grant and pending Rapid Response Facility would help in stabilising the economy.
“We have discussed the ongoing geopolitical tensions in the Middle East and how they have strained global economies, including that of Malawi. Consequently, I have requested support to cushion us from the impact we are experiencing,” Mutharika said in a statement that State House Press Office made available to The Nation last evening.
On the other hand, Belete is quoted as having said that the World Bank is considering deploying a Rapid Response Option, a financing instrument that allows for the reallocation of funds to address emerging crises.
“One of our primary concerns is the impact on food prices and the burden on poor and vulnerable populations,” he said. “We have discussed immediate actions to support these groups, as well as strategies to facilitate critical imports.”
Belete added that the bank is also prepared to extend support in sectors such as education, health and infrastructure under a new partnership framework.
Malawi’s request comes amid sharp domestic fuel price increases following the return to cost-reflective pricing under the Automatic Pricing Mechanism (APM). Petrol prices have risen from K3 499 last year to K6 672 in April this year while diesel has climbed to K6 687 over the same period. Kerosene prices have also increased by more than 80 percent.
The adjustments reflect rising global oil prices, foreign exchange constraints and accumulated debts to international fuel suppliers, limiting the authorities’ ability to cushion consumers.
Global markets have been equally volatile. Brent crude prices have surged by roughly 55 to 60 percent since late February following the outbreak of conflict between the United States and Iran, which disrupted nearly 20 percent of global oil supply through the Strait of Hormuz.
Prices rose from about $70 per barrel before the conflict to a peak of $126.41 in April before easing slightly to between $110 and $115 in recent weeks.
The spike has pushed up the cost of refined products globally, with diesel rising faster than petrol and kerosene-based fuels more than doubling in some markets, intensifying pressure on transport and food supply chains.
Economists say Malawi’s vulnerability reflects its heavy reliance on imports.
Economics Association of Malawi president Bertha Bangara-Chikadza said in an earlier interview: “Malawi, being a land-linked economy, is highly exposed to global fuel and geopolitical shocks. This indicates how much inflation is imported rather than domestically determined.”
She further observed that domestic pressures, including fiscal challenges and weather-related shocks affecting food supply, are compounding the situation.
Between January and April, international landing costs rose sharply, with Free on Board prices increasing by 42 percent for petrol and 87 percent for diesel. Meanwhile, the Price Stabilisation Fund—designed to cushion consumers—remains in arrears of about K1.1 trillion, limiting the ability to absorb further shocks.
Analysts warn that global oil markets remain highly uncertain. Oil prices have “nowhere to go but up” until the Strait of Hormuz is fully reopened, said Vandana Hari, founder of Vanda Insights.
“As of now, how and when that might happen is anybody’s guess,” she was quoted by CNN as having said.
Malawi’s economy is faced with slow growth and the United Nations (UN) recently said economic transformation remains slow and constrained by deep structural weaknesses that could derail further implementation of Malawi 2063 (MW2063), the country’s long-term development strategy that seeks to graduate the economy to lower middle-income status by 2030 and upper middle-income by 2063.
In its recently published Common Country Analysis, the UN says despite recovery efforts, the economy is struggling with low growth, rising vulnerability and limited transformation which threaten sustainable transformation.
In the 2026/27 National Budget, economic growth is projected to rise to 3.8 percent in 2026 from 2.7 percent in 2025 and further strengthen to 4.9 percent in 2027.
