Kenya has depleted the fuel subsidy fund which was meant to soften retail fuel prices so as to shield consumers from anticipated price increases that were to accrue as a result of volatile global geopolitical events.
As a result of ongoing tensions in the Middle East, there has been volatility in prices of oil which has partly resulted in the increase in fuel prices a litre of petrol, diesel and Kerosene trade at KES 186.31, KES 171.68 and KES 156.58 respectively, reflecting a sharp increase of KES 8.99, KES 8.67 and KES 9.65 respectively. These prices took effect from the 15th of July 2025 and are set to remain in force until the 14th of August 2025.
These high fuel prices have a probability of leading to an extensive surge in goods and services amid an economic set up where salary rises are unable to keep up with inflation. Notably, fuel is a big component in transportation, power generation and agriculture and this makes the increase in the fuel prices a very significant event for the Kenyan economy as the 2025/2026 financial year kicks off.
Energy Cabinet Secretary Mr Opiyo Wandayi spoke in Parliament saying that the ministry lacks KES 2.4 billion that is to be channeled to the petroleum development fund to steady pump prices for the month running to the 14th of August 2025. Consumers should brace themselves for the attendant price hikes that are set to kick in as a result of the fuel price increases.
Also Read: EPRA’s July Review: Fuel Prices Surge Amid Global Tensions.
