Eyes On Fuel Prices After Ruto's Plan To End Subsidy

Kenyans now have their eyes fixed on the Energy Petroleum and Regulatory Authority (EPRA) which is set to announce new fuel prices on Wednesday, September 14, especially following President William Ruto's plan to end the fuel subsidy.

During his speech on Tuesday, September 13 after he was sworn in as Kenya's fifth Head of State, he touched on the fuel subsidy, arguing that taxpayers have spent a total of Ksh144 billion, a whooping Ksh 60 billion in the last 4 months.

"If the subsidy continues to the end of the financial year, it will cost the taxpayer Ksh280 billion, equivalent to the entire national government development budget," he stated.

President William Ruto reading his speech at Kasarani Stadium after being sworn in as Kenya's fifth president on September 13, 2022. /WILLIAM RUTO

In his speech, however, he did not mention an intervention plan to save Kenyans from the high cost of living which would be made worse in the event fuel prices went up after the removal of the subsidy.

Ruto's move raised questions amongst Kenyans and in particular, motorists who consume the product ahead of the fuel price announcement.

As of now, the price of Super Petrol retails at Ksh159.12 per litre while Diesel is sold at Ksh140 per litre. Kerosene goes for Ksh127.94 per litre.

"In accordance with Section 101(y) of the Petroleum Act 2019, Legal Notice No.196 of 2010 and Legal Notice No. 26 of 2012, the Energy & Petroleum Regulatory Authority has calculated the maximum retail prices of petroleum products for the period 15th August to 14th September 2022," EPRA stated on Wednesday, August 14, a week after Kenyans took to the polls.

Following Ruto's announcement, some filling stations started rationing the product and others experienced shortages. Long queues were experienced in some parts of the country, triggering panic buying ahead of the review.

In addition, Kenya Pipeline Corporation (KPC) had warned that there would be a hike in fuel prices due to the failure by the exchequer to remit funds owned to oil marketers as well as the marketers going slow on picking the product at the Kipevu Oil Storage Facility and other storage areas, thus causing a shortage.

EPRA had nevertheless announced plans to review the KPC storage and pipeline tariffs, adding that the review of KPC charges would increase fuel prices slightly; that is, by Ksh0.54 per litre in Nairobi, Ksh0.42 per litre in Nakuru and Ksh0.29 per litre in Kisumu.

A directive by now-former President Uhuru Kenyatta, in a statement dated Thursday, July 14 and signed by State house spokesperson, Kanze Dena, revealed that fuel prices would be maintained.

“It is notified that His Excellency the President has today authorized an additional fuel subsidy of Ksh16.675 billion, so as to cushion Kenyans from a further increase in fuel prices.

“With today’s presidential action, diesel will continue to retail at Ksh140.00, petrol at Ksh159.12 and Kerosene at Ksh127.94. Without such State interventions, the pump prices would have been Ksh193.64 for diesel, Ksh209.95 for petrol and Ksh181.13 for Kerosene," read the state House statement in part at the time.

The review came as crude oil prices had begun to go down across the world but industry players warned motorists that they would have to continue buying expensive fuel till mid-August before the drop is applied.

Fuel prices update for between August 15, 2022, and September 14, 2022. /VIRALTEAKE