The Energy and Petroleum Regulatory Authority (EPRA) on Thursday September 14, announced new fuel prices for the September-October period.
According to the new prices Super Petrol increased by Kshs.16.96, Diesel increased by Kshs.21.32 per litre and Kerosene increased by Kshs.33.13 per litre.
This means, “Super Petrol, Diesel and Kerosene will retail at Kshs.211.64, 200.99 and 202.61 respectively in Nairobi effective midnight.”
“The prices are inclusive of the 16% Value Added Tax (VAT) in line with the provisions of the Finance Act 2023, the Tax Laws (Amendment) Act 2020 and the revised rates for excise duty adjusted for inflation as per Legal Notice No. 194 of 2020,” EPRA said in a statement.
Comparison to July-August Fuel Prices
Moreover, the new rates are an increment on fuel prices as compared to the ones announced for the July-August period.
Also Read: Oil Dealers Warn of Fuel Shortage After Ruto’s U-Turn
In the previous rates, a litre of petrol retailed at Ksh.194.68, diesel went for Ksh.179.67 while kerosene has been retailing at Ksh.169.48.
Nonetheless, the September-October period review of fuel prices comes at a time when oil dealers are decrying subsidies on fuel products.
Looming Fuel Shortage
The United Energy and Petroleum Association (Unepea) called on the government to remove the subsidies or reduce the rent penalty of Ksh100,000 of the levies and taxes in the cost of the product as opposed to the current refund method.
According to Unepea, this proposal would help with liquidity in the sector and allow for the free flow of fuel.
Likewise, independent oil dealers warned of an expected shortage of fuel in the coming week citing accumulation of a Ksh1.8 billion debt accrued due to government’s price stabilization programme.
These dealers explained that large Oil Marketing Companies (OMCS) are currently reluctant to sell to them at subsidized prices because of this debt.
Furthermore, independent oil dealers stated that they may be forced to close about 800 retail outlets across the country if President William Ruto’s stabilization programme is not reviewed.
According to Unepea chairperson Irene Kimathi the stabilization of prices distorts the market for dealers despite easing the burden for customers.
Also Read: EPRA Announces July-August Fuel Prices
President Ruto on Fuel Subsidy?
President William Ruto announced a fresh plan to stabilize fuel prices in August this year.
He stated that the government would compensate dealers using funds from the Petroleum Development Levy (PDL).
As such, this move raised questions on whether the stabilization plan was equivalent to a ‘subsidy’.
However, Ruto clarified that this action was not a ‘subsidy’ but purely a fuel stabilization mechanism through the PDL fund.
“Let me tell the country, we will not go to subsidies of any nature that distorted things and causes us unnecessary leakage,” he said then.
