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Kenya slashes pump prices for diesel, hikes petrol

Xinhua, January 14, 2017 Adjust font size:

Kenya's energy industry regulator on Saturday reduced petroleum pump prices for diesel and kerosene while it hiked petrol prices by different price margins in the latest review.

The Energy Regulatory Commission (ERC) said the review have been as a result of the average landed costs of imported super petrol increasing by 5.22 percent from 503.93 U.S. dollars per tonne in November to 530.24 dollars per tonne in December 2016.

"Taking into account the weighed average cost of imported refine petroleum products, the changes in the maximum allowed petroleum pump prices in Nairobi to increase by 1.181 shillings in Nairobi while diesel and kerosene decreased by 2.99 shillings and 0.12 shillings per litre respectively," ERC said in a statement.

The average landed cost of imported diesel decreased by 6.54 percent from 478.11 dollars per tonne to 446.84 dollars per tonne and kerosene declined by 2.51 percent from 500.45 dollars per tonne to 487.91 dollars per tonne.

The industry regulator said Free on Board (FOB) price of Murban crude oil lifted in December 2016 was posted at 54.15 dollars per barrel, an increase of 17.33 percent from 46.15 dollars per barrel in November 2016.

Market analysts say the new prices could see the cost of living generally go down slightly given the heavy reliance on kerosene and diesel for transport, energy generation and agriculture especially among the low income earners who use kerosene for cooking.

Fuel prices have a significant impact on inflation in an economy which depends heavily on diesel for transport, power generation and agriculture, while kerosene is used in many households for lighting and cooking.

The ERC assured the public of its continued commitment to the observance of the principles of fair competition and the protection of the interests of both consumers and investors in the energy sector.

The purpose of the fuel pricing regulation is to cap the pump prices of the products which are already in the country, such as the importation and other prudently incurred costs are recovered, while ensuring reasonable prices to consumers. Endit