Matatus Owners Association announces increase in fare after hike in fuel prices

The Matatu Owners Association has signalled a hike in fare prices after the Energy and Petroleum Regulatory Authority (EPRA) increased the price of diesel and petrol for the months of June and July.

The Matatu Owners Association has given its members the go-ahead to raise fare prices for various routes.

Users of some routes will experience an increase between Sh20 and Sh50.

A photo inside one of the matatus in Nairobi Pulse Live Kenya

On Tuesday, June 14, EPRA announced an increase in fuel prices in its monthly review.

EPRA issued a statement informing Kenyans that the price of fuel and diesel has increased by Sh9.

Petrol will cost Sh159.12 per litre, up from Sh150.12, diesel will cost Sh140, up from Sh131, and kerosene will cost Sh127, up from Sh118.94 per litre, under the new price.

The revised pricing took effect from midnight June 15 through to midnight on July 14, when EPRA will publish the next review.

"In the period under review, the pump prices of Super Petrol, Diesel and Kerosene increase by Sh9.00 per litre respectively. Super Petrol, Diesel and Kerosene will now retail at Sh159.12, Sh140 and Sh127.94 per litre respectively in Nairobi starting midnight," EPRA said in the statement.

The government has also said it will be withdrawing the fuel subsidy which was implemented to cushion motorists from rising global fuel prices.

The National Treasury has allocated Sh100 billion for the subsidy for the 2022/23 financial year but argues that it is not sustainable.

Matatus on Nairobi's Moi Avenue where Kencom and Ambassador stages are Pulse Live Kenya

However, with rising global fuel prices, the additional fuel expenses may ultimately exceed this allocation in the national budget, expanding public debt to an unsustainable level.

Without the fuel subsidy, fuel prices would have retailed at Sh184.68, Sh188.19 and Sh170.37 per litre of petrol, diesel and kerosene, respectively.

“However, fuel subsidies are inefficient and often lead to misallocation of resources and crowding out of public spending on productive sectors, resulting in unintended consequences such as disproportionately benefiting the well-off,” Treasury CS Ukur Yatani said on Wednesday.