Fuel prices in Kenya are set to increase by at least Ksh 7 per litre following the Energy and Petroleum Regulatory Authority’s (EPRA) latest pricing review. The expected adjustments will see petrol prices rise by Ksh 7.80, diesel by Ksh 7.75, and kerosene by Ksh 7.67, marking a significant shift in the cost of petroleum products across the country.
EPRA Director General Daniel Kiptoo has described the review as a delicate balancing act aimed at ensuring fuel retailers remain profitable while continuing to invest in infrastructure and service quality. The agency, tasked with regulating petroleum prices, conducts periodic assessments of the value chain elements affecting fuel costs to enhance network efficiency and sustainability.
One of EPRA’s key mechanisms for evaluating fuel pricing structures is the Cost of Service Studies (COSS), which analyze the various components influencing petroleum prices. The first COSS, conducted in 2018, led to major regulatory changes, including the unbundling of pipeline services, a revision of fuel margins, and the introduction of new inventory financing strategies.
With evolving market conditions and legislative adjustments, EPRA commissioned a second study in December 2023. This assessment, carried out by industry consultants, aims to refine pricing structures further by considering factors such as import cost optimization, pipeline and road transport expenses, storage tariffs, and inventory financing models.
According to EPRA, the new pricing adjustments will be implemented gradually to cushion consumers and businesses from sudden price shocks. This phased approach is intended to facilitate a smooth transition and prevent abrupt disruptions in the fuel supply chain.
The expected rise in fuel prices comes amid global economic pressures and local taxation policies that have continuously influenced Kenya’s petroleum sector. Higher fuel costs are likely to impact various industries, including transport, manufacturing, and agriculture, with a ripple effect on the cost of goods and services.
As EPRA moves forward with its revised pricing model, stakeholders across different sectors will be closely monitoring the impact of these changes on economic activities and household expenditures. Consumers are advised to brace for the adjustments while policymakers consider potential measures to mitigate adverse effects on the economy.
