State shelves fuel tax to halt pump price surge

On Monday, crude prices stood at $82.70 a barrel and oil marketers the National Oil Corporation (NOCK) and Kenya Shell said the price was yet to be accounted on the current prices.

Mr Mwendia Nyaga, the managing director of Nock, reckons that the current pump prices are based on fuel imported in February at $74.20.

“The impact on refined imports will be immediate. Products that are being loaded now will cost Sh4-5 more for petrol, diesel, Kerosene,” added Mr Nyaga.

Same product

A spot-check by the Business Daily showed that unleaded fuel was retailing at Sh87 a litre within the Central Business District (CBD) although it was still possible to find the same product in some branded stations selling at Sh83 outside the city centre.

This is clear signal that consumers are set for expensive fuel in the coming days.

The effects of a rise in petroleum products could spread throughout Kenya’s economy.

Households will have to part with more money to meet their fuel expenses, a move that will see families left with less to spend on other products such as airtime and leisure.

This is crucial given that most producers have been struggling to push their products in the market place due to the country’s soft economy.

Producers themselves could be pushed to increase their product prices that are often linked to the cost of petrol.

There is also the blow for public transport users as operators are expected to increase their fares as they pass on the additional expenses to consumers.

As a result, energy costs are set to join expensive food as drivers to the cost of living or inflation.