Pump prices will remain unchanged for the next month to March 14, helped by the application of a subsidy to cushion consumers from the increased cost of shipping fuel.
A litre of petrol and diesel will retail at Sh176.58 and Sh167.06 respectively in Nairobi, while kerosene will sell at Sh151.39 in the capital.
The Energy and Petroleum Regulatory Authority (Epra) has applied a subsidy of Sh5.59 per litre on diesel and Sh2.41 per litre on petrol. The highest subsidy is on kerosene at Sh8.74 per litre.
The landed costs (shipping costs) of the three grades of petroleum rose, setting the stage for a rise in pump prices if the subsidy had not been applied. Expensive fuel would have triggered a rise in inflation, further stoking public outrage over the high cost of living.
“In the period under review, the maximum allowed petroleum pump prices for super petrol, diesel and kerosene remain unchanged,” Daniel Kiptoo, the Epra director-general, said in the gazette notice published on Friday evening.
The landed cost of diesel rose by 4.2 percent to $671.14 (Sh86,986) per barrel in January from $644.19 (Sh83,462) in December, while a similar quantity of petrol rose by 2.8 percent to $628.80 (Sh81,498) from $611.69 (Sh79,262).
Inflation rose to 3.3 percent last month from 2.8 percent in December last year. This (inflation) would have increased further this month if pump prices had gone up.
Diesel is the main fuel in the Kenyan economy and the price of the commodity is a key measure of the cost of living.
The use of the subsidy to cushion consumers also underlines the negative impact of the government-to-government-backed fuel import deal that Kenya signed with three Gulf oil majors.
Global crude oil prices fell to $72.81 (Sh9,436.9) per barrel last month from $74.87 (Sh9,701) for the same quantity in December, which could have led to a drop in local pump prices.
Kenya is importing fuel at fixed prices under the government-to-government deal with Gulf oil majors, meaning that a fall in global spot markets cannot be felt locally unless the shilling strengthens drastically against the dollar.
The last time the prices of the three grades of fuel remained unchanged was in the monthly cycles of October and November last year.
Consumers had enjoyed a steady decline in pump prices for most of last year as the shilling strengthened against the dollar, helping to offset the impact of fixed fuel prices under the agreement with the three Gulf oil majors.
But the local currency has stagnated in recent months, exposing consumers to high fuel prices under the government-backed deal.
Kenya has been importing fuel from Saudi Aramco, Abu Dhabi National Oil Corporation and Emirates National Oil Company under fixed prices for the three grades of fuel since 2023.
