Lamu brokers sell litre of petrol at Sh260 as shortage bites

What you need to know:

Mainstream dealers say they have stopped selling fuel because the price caps set by the energy regulator have seen them run into losses.
This has seen middlemen, who are not under the watch of the Energy Regulatory Commission , selling a litre of petrol at between Sh200 and Sh260.
A litre of petrol should trade at a maximum of Sh99.43 in Lamu, Sh98.73 in Nairobi, Sh95.47 (Mombasa) and Sh100.72 in Kisumu, according to the latest fixtures.

Middlemen are selling a litre of petrol at Sh260 in Mpeketoni town, Lamu West Sub-County, following an acute shortage of fuel over the past two weeks.

Mainstream dealers say they have stopped selling fuel because the price caps set by the energy regulator have seen them run into losses.

This has forced middlemen, who are not under the watch of the Energy Regulatory Commission (ERC), sell a litre of petrol at between Sh200 and Sh260.

ERC has been setting the price of petrol, diesel and kerosene since 2010. The regulator sets prices for various regions of the country monthly.

A litre of petrol should trade at a maximum of Sh99.43 in Lamu, Sh98.73 in Nairobi, Sh95.47 (Mombasa) and Sh100.72 in Kisumu, according to the latest fixtures.

“A person convicted of retailing petroleum products above the maximum levels will be liable to a fine not exceeding Sh1 million, or the withdrawal of their operating licence or both,” says the ERC. This warning has seen mainstream players keep off selling fuel. Mpeketoni town has four stations but all are not selling fuel.

Boda boda operators and motorists operating within the town, known for agricultural products and as a business hub in the region, are the most affected.

READ: Why Kenyans still pay more for fuel amid low oil prices

Commuters have been hard hit with fares rising steeply.

Businesses like flour millers have also suffered due to petrol shortage since most use the fuel. Boda boda operators, taxis and other transporters have also been forced to hike fares.

“We are now forced to buy fuel from middlemen who are thoroughly fleecing us. A litre of petrol has increased from Sh97 to 250 or even Sh260. And even then, the fuel is scarce and one has to go round and round to get a little,” said Mr James Njuguna Komu, a motorist.

Investors say business is low since they have lost customers due to the raised fares.

“We need an urgent solution. Sometimes we have to go up to Mokowe town which is over 60 kilometres away in search of petrol. Some of our customers don’t understand why they have pay more,” said Mr Maurice Kariuki, a boda boda operator.