Kenya’s oil import bill rose by Sh47 billion in the first eight months of the year to a three-year high despite a drop in diesel consumption, according to the latest official data.
The country imported Sh176.8 billion worth of fuel and lubricants in the year through August, up from Sh129 billion in the same period last year – representing a growth of 37 per cent.
The trend defied a slight fall in consumption of diesel – the most used fuel in the economy that powers industries, agricultural machinery and commercial vehicles.
The Kenya National Bureau of Statistics (KNBS) data indicates that oil accounted for 15 per cent of the total import bill, offering a glimpse into its impact on the foreign exchange market.
This is the first time that the petroleum import bill has increased since 2015 when it slipped below Sh200 billion as global crude prices dipped.
At the peak in 2014, Kenya’s oil import bill stood at Sh237 billion and dropped in subsequent years even as local demand rose with the drop in global prices.
But global crude prices have recently been on a climb, pushing up costs for net oil importing economies like Kenya and piling pressure on the shilling as demand for US dollars soars.
Diesel consumption in Kenya tanked to 1.24 billion litres in the six months to June compared to 1.25 billion litres during a similar period last year, industry data shows.
The drop in diesel use came amid a slowdown in commercial activity as result of a prolonged election cycle. Industry data shows that the intake of petrol, mostly used in private cars, rallied six per cent in the half-year period to 836.4 million litres, underlining Kenyans’ love for travel in personal cars.
Motorists paid an average of Sh98 at the pump for a litre of petrol in the capital city, Nairobi in the year to August, up from Sh87.48 in a similar period last year, adding them a burden of Sh10 per litre on average.
Diesel pump prices rose to an average of Sh87.22 a litre in the capital city in the review period, from Sh73.54.