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Energy & Petroleum Regulatory Authority (EPRA) has announced significant increases in the maximum retail prices of petroleum products, effective from September 15, 2023, to October 14, 2023.
The changes in the maximum allowed petroleum pump prices in Nairobi are as follows: Super Petrol will increase by Sh.16.96 per litre, diesel will increase by Sh21.32 per litre, and kerosene will increase by Sh33.13 per litre.
As a result, the new prices of these essential fuels in Nairobi will be Sh211.64 for Super Petrol, Sh200.99 for Diesel, and Sh202.61 for Kerosene.
These prices include the 16% Value Added Tax (VAT) in accordance with the provisions of the Finance Act 2023, the Tax Laws (Amendment) Act 2020, and the revised rates for excise duty adjusted for inflation as per Legal Notice No. 194 of 2020.
The EPRA cited the increasing cost of imported refined petroleum products as the primary reason behind these price hikes.
The average landed cost of imported Super Petrol rose by 4.80% from US$739.21 per cubic meter in July 2023 to US$774.67 per cubic meter in August 2023.
Diesel experienced a more substantial increase of 12.52%, with its average landed cost climbing from US$701.99 per cubic meter to US$789.89 per cubic meter.
Kerosene, used by many Kenyan households, saw a staggering rise of 19.79%, with the cost per cubic meter jumping from US$690.58 to US$827.26.
It is important to note that Kenya imports all its petroleum product requirements in refined form, which makes the country susceptible to fluctuations in global oil prices and international market dynamics.
These price increases come at a time when Kenyans are already grappling with the rising cost of living, including soaring food prices and increased electricity tariffs.
The announcement has been met with mixed reactions, with consumers expressing concern over the potential impact on their daily budgets.
Businesses that rely heavily on fuel for transportation and power generation are also bracing themselves for higher operational costs.
This includes the transportation and logistics sectors, which are vital for the distribution of goods across the country.
As Kenyans prepare for these new fuel prices to take effect, there is growing anticipation for the government to implement measures to cushion vulnerable segments of the population from the adverse effects of the high cost of living.