Last week, the petroleum regulator announced huge petroleum consumer price cuts, a welcome blessing to those Kenyans who can still make good use of the cheap oil in these times of restricted travel. The price decreases were indeed anticipated as Brent crude oil dipped below $30 in March/April, levels last witnessed in 1990s. The decreases were aggravated by a major oil supply glut, caused by diminished global oil demands as a result of Covid-19 pandemic.
However, the Kenyan oil marketers had a problem with the hefty price decreases. They complained to the petroleum ministry that the low selling prices would cause them financial losses as slow-moving expensive stocks (imported a couple of months earlier when import prices were higher) remained unsold. Slow moving because the Covid-19 travel restrictions had chewed up as much as 40 percent of potential petroleum demands, leaving them holding inventories of more expensive stocks.
