A fuel attendant at the Ola Energy Station in Mombasa.

| Kevin Odit | Nation Media Group

Kenya has costliest fuel in East Africa despite latest price cut

Kenya has the most expensive fuel in the East African region even after the regulator cut pump prices by up to Sh10 a litre in the latest price review.

A comparison by GlobalPetrolPrices.com —a site that tracks fuel prices globally— shows that a litre of Super petrol is going for $1.478 in Nairobi, with Uganda being the second costliest at $1.46 while Tanzania has the cheapest at $1.26.

A litre of diesel is going for $1.37 in Nairobi, followed by $1.31 in Kampala while it is cheapest in Dar es Salaam at $1.24. The prices in the other countries are as of April 8.

This comes even after pump prices dropped to the lowest in over a year from last Sunday with a litre of super petrol at Sh193.84 from Sh199.15 while that of diesel fell to Sh180.38 from Sh190.38.

The strong shilling rally against the dollar drove the fall, negating the impact of a global rise in Murban crude prices.

“The strengthening of the shilling against the dollar has led to the drop, helping undo the impact of the rising prices of crude in the global market”, Daniel Kiptoo, director-general of the Energy and Petroleum Regulatory Authority (Epra) said on Sunday.

Seven levies

The shilling has rallied in the past two months from 161.74 units to the dollar in mid-February to 133.54 units last month, which was used by the Epra to set the latest prices.

Cheaper fuel in the countries shines the spotlight on the taxation of fuel in Kenya which has been cited as a hurdle in lowering pump prices, denying Kenyans even higher reductions at the pump.

Kenya charges seven levies and two taxes on Super petrol, diesel and kerosene, accounting for up to 39 percent of the cost per litre of fuel.

Taxes and levies account for 39.5 percent or Sh76.57 per litre of Super petrol and 35.1 percent (Sh57.750) for every litre of diesel.

Parliament last year doubled Value Added Tax (VAT) on fuel to 16 percent.

All countries in the East African region with the exception of Tanzania rely on the port of Mombasa and Kenyan-based oil marketers for their fuel supplies.

Kenya’s heavy taxes on fuel have negated the impact of the shilling’s recovery in lowering pump prices, denying consumers even further cuts.

Fuel prices in Kenya are way higher than in leading economies on the continent such as Nigeria, South Africa and Ghana.

In South Africa, a litre of Super petrol is going for $1.35 while that of diesel is retailing at $1.34.

In Ghana, consumers are paying $1.055 for a litre of Super petrol and $1.099 for a similar quantity of diesel.

Nigeria has the cheapest fuel with a litre of Super petrol retailing at $0.54 while that of diesel is costlier at $1.007.

In January, the Dangote Petroleum Refinery started refining crude oil at the start of this year in what is tipped to significantly lower prices of refined fuel in the country.