For the first time in months, diesel price in Kenya costs less than in any other East African Country. A litre of diesel costs Ksh112.63 on average in Kenya, compared to Ksh118.44, Ksh139.08 and Ksh149.91 in Tanzania, Uganda and Burundi, respectively.
Diesel price in Kenya cheapest in Eastern Africa
Diesel price in Kenya today costs Sh112.63
A pump attendant fills the tank of a car at a petrol station in September 4, 2018 in Nairobi as a 16 per cent VAT on petroleum products was decided and fuel distributors refused to collect stocks from depots. (Photo by SIMON MAINA/AFP via Getty Images)
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This has been attributed to the Energy and Regulatory Authority (EPRA) introduction of a fuel subsidy on October 15 last year as part of efforts to defuse simmering public anger over the high cost of basic items.
The regulator slashed Sh5 off a litre of diesel despite an increase in global prices. In its February fuel price review, the (EPRA) once again saved motorists from paying Sh23.29 more on a litre of diesel.
The subsidy kept pump prices unchanged for the fourth month in a row despite a jump in the cost of shipping the refined fuel. Without the subsidy, consumers would have paid Sh133.89 for a litre of diesel.
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Fuel inflation was the key driver of overall consumer prices in Kenya in the past year. Image: Nation Africa
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Russia/Ukraine crisis increase fuel prices
However on Tuesday, March 8, Oil Marketing Companies (OMCs) deliberated on the way forward after the government indicated it would be difficult to sustain the subsidy as global prices skyrocket due to the Russia/Ukraine crisis.
The current fuel being consumed in Kenya is based on the average crude oil prices of $82.03 a barrel, and the monthly review set for next Tuesday at $92.
Oil prices have jumped more than 30 percent since February 24, touching $139 a barrel at one point this week.
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Oil prices have surged following Russia's invasion of Ukraine.
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Last month, Petroleum Principal Secretary Andrew Kamau told Members of Parliament that the global rally in crude prices has piled pressure on the fund which is fast being depleted.
''The government is struggling to pay oil marketers for the high cuts on their margins to keep pump prices unchanged, making future the fuel subsidy scheme uncertain,'' Kamau told the National Assembly Committee on Energy.
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