Consumers of fuel in Kenya will not enjoy any reduction in fuel prices at the pumps despite a drop in the landed cost of the commodity.
This is because the East African nation’s Energy and Petroleum Regulatory Authority (EPRA) has retained pump prices for petroleum products despite a drop in the landed cost.
The landed cost of imported Super petrol decreased by 4.1 per cent from US$627.80 (Sh71,206) per cubic metre in November to US$601.97 (Sh68, 276) in December.
Diesel decreased by 5.71 per cent from $600.22 (Sh68,078) to US$565.92 per cubic metre, while kerosene decreased by 4.89 per cent to US$574.85 (Sh65,194) per cubic metre.
A litre of petrol currently retails at Sh129.72 (US$1.14) in Nairobi, while diesel is sold for Sh110.60 (US$0.97) per litre.
Kerosene is being retailed at Sh103.54 per litre.
EPRA Director-General, Daniel Kiptoo said the government would utilise the Petroleum Development Levy to cushion consumers “from the otherwise high prices.
“The prices are inclusive of eight per cent VAT in line with provisions with the Finance Act and the revised rates of excise duty adjusted for inflation,” Kiptoo said.
This comes amid concerns by Oil Marketing Companies (OMCs) over the government defaulting on compensation under its fuel subsidy initiative introduced mid-last year.
In November, the Energy and Petroleum Regulatory Authority cut margins for the oil marketers to keep pump prices unchanged after a public outcry on rising pump prices.
Billions of shillings, however, remain unpaid, leaving OMCs’ cash flow dented.
They now want the government to pay interest on the delayed funds, a cost that will be passed to taxpayers.
Source: https://energynewsafrica.com