Relief for motorists as fuel prices drop to lowest in more than a decade - Beaking Kenya News

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Friday, 15 May 2020

Relief for motorists as fuel prices drop to lowest in more than a decade

Kimathi Street petrol station
It is a good time to be a motorist, after fuel pump prices dropped by about Sh20 for every litre, the biggest fall in over a decade.
The drop has seen Kenyan motorists start enjoying the benefits of the collapse in international crude prices, after more than two years of waiting.
In its latest monthly review, the Energy and Petroleum Regulatory Authority (EPRA) cut diesel prices by the biggest margin of Sh19.9 per litre, giving transporters and big manufacturers a major relief.
Petrol reduced by Sh9.54 while Kerosene increased bySh2.49 per litre from last night, when oil marketers were expected to adjust their pump prices.
EPRA, however, said computation of the pump prices took into account the changes occasioned by the Tax Laws (Amendment) Act of 2020, which made taxes and other levies part of the vatable amount in the calculation of value-added tax (VAT) for petroleum products.
This effectively denied motorists extra savings.
Further, no kerosene cargo was discharged at the Mombasa port between April and May. This saw the kerosene prices maintained but with adjustments in VAT calculation.
“The changes in this month’s prices are as a consequence of the average landed cost of imported super petrol decreasing by 38.94 per cent for US$309.03 per cubic metre in March 2020 to US$188.07 per cubic metre in April,” EPRA said in a statement yesterday.
Diesel price decreased by 44 per cent from $432.7 per cubic metre to $242.13 per cubic metre.
The adjustment means super petrol will now retail at Sh83.33 per litre in Nairobi while diesel and kerosene will sell at Sh78.37 and Sh79.77 per litre respectively.
In Mombasa, a litre of petrol will go for Sh80.85, diesel Sh75.88 and kerosene will retail at Sh77.29.
Motorists in Kisumu will buy petrol at Sh84.19, diesel Sh79.37 and Kerosene Sh80.77. These prices will be enjoyed until June 14, when the next review is due.
The drop is expected to translate into lower costs of living. The cost of electricity is also expected to go down given that diesel is one of the factors that determine the price of electricity in Kenya.
The drop in prices comes at a time when oil marketers had put up a fight to keep the prices from falling on grounds that they had old stocks acquired at expensive prices.
But EPRA director-general Pavel Oimeke dismissed them saying the regulator will not implement such a request since it is illegal.
“The request that has been made by the oil marketing companies is against the law and regulations and hence EPRA will not implement it,” he said.
“Amendment of the petroleum pricing formula requires stakeholder engagement, public participation, and approval by the EPRA board before finally being gazetted by the minister.”
In a letter to Petroleum Secretary John Munyes, oil marketers through the chairman of the Oil Industry Supply Coordination Committee and KenolKobil general manager Martin Kimani requested for the fuel to be maintained at the current prices in the monthly.

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