Kenyans can expect even higher fuel prices in the coming months as a result of global factors affecting the sector that are beyond the government’s control, according to Energy and Petroleum Cabinet Secretary Davis Chirchir.
Speaking before the National Assembly’s Departmental Committee on Energy on Friday, CS Chirchir stated that the Organisation of the Petroleum Exporting Countries (OPEC) has reduced global oil production by about 3.6 million barrels per day, affecting commodity availability and pricing.
He additionally cited the protracted Russia-Ukraine conflict as another factor that could lead to an increase in fuel prices.
“We’re dealing with several governments as suppliers of these products. Yesterday, we launched the EV Mobility Regulations, and we made a very comprehensive presentation on the cost of fuel today and going forward, and we’re likely to even be going to harder times because these are Platt prices from OPEC, and there’s nothing much we can do about them. There’s been some 3.6 million barrels cut on a daily basis…that’s about 3.6%-4% (of global fuel consumption)…it’s just unfortunate that we don’t have our own product as a country,” he stated.
The CS went on to say that the Kenya Kwanza administration’s decision to eliminate the previous government’s fuel subsidies is another factor that will cause prices to continue rising.
According to CS Chirchir, this decision was made after the government allegedly made an irreversible pact with the International Monetary Fund (IMF).
“The price of kerosene between June and today has gone up by over USD250 per barrel, from a low of 600 to a high of 900. What we’ve previously done when we ran the subsidy program is we took this away from Kenyans and they did not see the increase, and we paid on the back of the Treasury balance sheet,” he noted.
“We have the stabilization fund which raises about Ksh.5.40 for each diesel and PMS, and which only collects about Ksh.2.5 billion. The increase this time on the basis of the landed international cost prices, was up by about Ksh.8.7 billion. I wish it was still possible to subsidise, but we had some covenants with IMF. But suddenly the pain is heavy, it is not going to be easy.”
He added: “Luckily, because of our G2G, in the last two weeks when we noticed the trend was going off, we went back to the international rail companies and negotiated to bring down the freight and premium.”
CS Chirchir’s remarks followed those of his Investments, Trade and Industry counterpart Moses Kuria, who urged the public to tighten their belts and brace themselves for even higher petrol prices in the coming months.
According to Kuria, the country’s fuel prices will continue to rise by at least Ksh.10 per month until February of next year.
“Global Crude Prices are on an upward trajectory. For planning purposes expect pump prices to go up by Ksh 10 every month till February,” Kuria posted on his official X account.
The Energy and Petroleum Regulatory Authority (EPRA) announced on Thursday that Super Petrol prices have increased by Ksh.16.96, Diesel by Ksh.21.32, and Kerosene by Ksh.33.13 per litre.
Super Petrol in Nairobi will now cost Ksh.211.64 per litre, Diesel will cost Ksh.200.99, and Kerosene will cost Ksh.202.61.
