End Of Fuel Subsidy As Gov’t Hikes Fuel Prices

The government has completely removed the subsidy on diesel and kerosene, marking the end of the fuel subsidy programme even as fuel prices hike.

In an announcement on Sunday night, the Energy & Petroleum Regulatory Authority (EPRA) increased the retail price of super petrol, diesel and kerosene by Ksh3.40 per litre, Ksh6.40 per litre and Ksh15.19 per litre respectively.

As a result, the new price per litre of super petrol, diesel and kerosene in Nairobi will be Ksh182.70, Ksh168.40 and Ksh161.13 respectively.

The prices will be in force from May 15, 2023, to June 14, 2023.

“Taking into account the weighted average cost of imported refined petroleum products, the changes in the maximum allowed petroleum pump prices in Nairobi are as follows: super petrol, diesel and kerosene increase by Ksh3.40 per litre, Ksh6.40 per litre and Ksh15.19 per litre respectively,” EPRA said.

“The prices are inclusive of the 8% Value Added Tax (VAT) in line with the provisions of the Finance Act 2018, the Tax Laws (Amendment) Act 2020 and the revised rates for excise duty adjusted for inflation as per Legal Notice No. 194 of 2020.”

The average landed cost of imported super petrol increased by 8.63% from US$666.51 per cubic metre in March 2023 to US$724.01 per cubic metre in April 2023; diesel decreased by 2.51% from US$705.82 per cubic metre to US$688.07 per cubic metre while kerosene decreased by 1.13% from US$707.53 per cubic metre to US$699.54 per cubic metre.

The Free On board (FOB) price of Murban crude oil lifted in April 2023 was posted at US$ 83.36 per barrel an increase of 0.88% from US$82.63 per barrel in March 2023.

Over the same period, the mean monthly US Dollar to Kenya Shilling exchange rate appreciated by 0.47% from Ksh139.61 per US$ in March 2023 to Ksh138.96 per US$ in April 2023.

Read: Why EPRA Kept Fuel Prices Unchanged

>>> EPRA Denies Approving Hike in Electricity Prices