Fuel prices unchanged despite higher import costs
A pump attendant fuels a car.
Pump prices will remain unchanged for the next one month to March 14, helped by application of a subsidy to cushion consumers from the increased cost of shipping fuel.
A litre of petrol and diesel will retail at Sh176.58 and Sh167.06 respectively in Nairobi while that of kerosene will be sold at Sh151.39 in the capital.
The Energy and Petroleum Regulatory Authority (Epra) applied a subsidy of Sh5.59 per litre on diesel and Sh2.41 per litre on petrol. The subsidy is biggest on kerosene at Sh8.74 per litre.
The landed cost (shipping costs) of the three grades of petroleum rose, setting the stage for a rise in pump prices were it not for application of the subsidy. Costly fuel would have triggered a rise in inflation further stoking public outrage over high cost of living.
“In the period under review, the maximum allowed petroleum pump prices for super petrol, diesel and kerosene remain unchanged,” Daniel Kiptoo, the Director General of Epra says in the gazette notice published on Friday evening.
The landed cost of diesel rose by 4.20 percent to $671.14 (Sh86,986) per barrel in January from $644.19 (Sh83,462) in December 2024 while a similar quantity of petrol rose by 2.8 percent to $628.80 (Sh81,498) from $611.69 (Sh79,262).
Inflation rose to 3.3 percent last month compared to 2.8 percent in December last year. This (inflation) would have risen further this month had the pump prices gone up.
Diesel is the main fuel in the Kenyan economy, and prices of the commodity are key in determining the measure of the cost of living.
Application of the subsidy to cushion consumers also underlines the negative impact of the Government-to Government backed importation of fuel that Kenya signed with three Gulf oil majors.
Global prices of crude oil dropped to $72.81 (Sh9,436.9) per barrel last month compared to $74.87 (Sh9,701) for the same quantity in December, in what could have seen local pump prices fall.
Kenya is importing fuel at fixed prices under the Government-to-Government deal with Gulf oil majors, meaning that a drop in the global spot markets cannot be felt locally unless the shilling drastically strengthens against the dollar.
The last time prices of the three grades of fuel remained unchanged was in the monthly cycles of October and November last year.
Consumers had for the larger part of last year enjoyed steady drops in pump prices due to the strengthening shilling against the dollar, which helped undo the impact of fixed prices of fuel under the deal with three Gulf oil majors.
But the local currency has in the past few months stagnated, exposing consumers to high fuel prices under the government-backed deal.
Kenya has since 2023 been importing fuel from Saudi Aramco, Abu Dhabi National Oil Corporation and Emirates National Oil Company under fixed prices for the three fuel grades.