Reasons Behind High Petrol Prices in Kenya

 fuel prices
A motorist fuels his car. The high cost of Petrol has been attributed to the high landing cost and taxing of super petrol. PHOTO/FILE

For the last few months, Kenyans have been struggling with rising inflation one of them being a high cost of petroleum products and in specific petrol.

Two days ago, the Energy Regulatory Commission in Kenya announced another increased prices in Petrol and Kerosene. Top among the reasons for the July-August 2019 petrol hike is the high landing cost and taxing of super petrol.

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A breakdown of how the Energy and Petroleum Regulatory Authority (EPRA) settled on the pricing of Super Petrol in Nairobi proves it. The cost of importing 1 litre of super petrol in Nairobi is currently at Sh54.19 before taxation and transport costs are imposed.

Before super petrol gets to Nairobi, it will be taxed for Excise Duty (Sh20.92) and Road Maintenance Levy of Sh18.00 per litre. Super petrol will also be taxed for Petroleum Development Levy (Sh0.40) and Petroleum Regulatory Levy (Sh0.25).

Therefore, when you add the cost of importing petrol and the taxes, the total comes to Sh101.02.

According to a statement released by EPRA, starting July 15th to August 14th, 2019, super petrol prices will rise by Sh0.29. However, Diesel and Kerosene prices will decrease by Sh0.88 and Sh2.31 respectively.

Since January, the cost of petrol has risen by Sh11.94, diesel by Sh8.31 and kerosene by Sh7.63. Mr. Pavel Oimeke, the director-general of Epra, links the steep rise in the cost of petrol, and kerosene to the high cost of crude oil in the international market.

Despite the start of Crude oil Extractions in Turkana, Kenya still sources 100 percent of its petroleum products from the international market after every 30 days.






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