The Energy and Petroleum Regulatory Authority (EPRA) has announced a significant increase in fuel prices, citing rising global oil costs and heightened geopolitical tensions. The latest review, effective from July 15 to August 14, reflects the steepest hike in over a year, breaking a prolonged period of relative price stability.
According to EPRA, the pump prices in Nairobi have risen as follows:
- Super Petrol: Up by KES 8.99 to KES 186.31
- Diesel: Up by KES 8.67 to KES 171.58
- Kerosene: Up by KES 9.65 to KES 156.58
These adjustments mark a sharp departure from last month’s rates of KES 177.32, KES 162.91, and KES 146.93, respectively.
The surge is primarily attributed to increased landed costs—the price of fuel before taxes and distribution margins—as well as rising freight charges. Shipping disruptions in the Strait of Hormuz, a critical waterway between Oman and Iran, have forced vessels to reroute, inflating transport costs that are ultimately passed on to consumers.
Kenya’s reliance on imported petroleum products leaves it vulnerable to such global shocks, pushing EPRA to hike prices based on global shifts. Diesel, in particular, plays a pivotal role in powering agriculture, manufacturing, and electricity generation. Consequently, any fuel price hike exerts upward pressure on inflation and operational costs across sectors.
Energy Cabinet Secretary Opiyo Wandayi recently warned that escalating tensions between Iran and Israel could further destabilize oil markets. While Kenya’s government-to-government fuel import deal with Gulf nations offers some protection against supply shortages, it does not shield consumers from price volatility.
The prices include 16% VAT and reflect adjustments under the Finance Act and the Tax Laws (Amendment) Act 2024. As the country braces for the economic ripple effects, stakeholders are calling for more robust energy diversification strategies to reduce exposure to external shocks.
