Motorists to pay more as petrol price rises for fifth month in a row

The energy regulator has signalled more pain at the pump for motorists after it announced that the cost of petrol will rise by Sh0.29 a litre to Sh115.39 in Nairobi in its latest review.

The hike in petrol prices is the fifth monthly increase in a row.

The price of diesel, which is used to power commercial vehicles like matatus, vans, tractors and trucks as well as in industries, decreased marginally by Sh0.88 to Sh103.88 in the city. The drop bucks the rising trend since March. It will favour commercial activities.

The price of kerosene, which is mostly used in low income homes for lighting and powering cooking stoves, dropped the most by Sh2.31 to Sh101.97 in Nairobi, according to the new monthly prices set by the Energy and Petroleum Regulatory Authority (EPRA).

The regulator said the latest review came on the background of a drop in global oil prices but also a 5.17 percent annual inflation tax adjustment on excise duty charged on fuel products.

“The changes in this month’s prices have been as a consequence of the average landed cost of imported Super petrol decreasing by 1.83 percent from $538.08 per cubic meter in May 2019 to $528.26 in June 2019, Diesel decreasing by 3.07 percent from $535.84 per cubic meter to $519.39 per cubic meter and Kerosene decreasing by 5.49 percent from $532.89 per cubic meter to $503.63 per cubic meter,” said EPRA director-general Robert Oimeke on Sunday.

“The pump prices are inclusive of eight percent Value Added Tax in line of the provisions of the Finance Act 2018 and the revised rates for excise duty adjusted for inflation via legal notice 109 of 9 July 2019.”

The EPRA review is dependent on the average landed cost of imported oil, Free On Board (FOB) price of Murban crude oil lifted as well as the mean monthly dollar to shilling exchange rate.

The shilling depreciated by 0.68 percent against the dollar to 101.89 in June as the cost of crude oil dropped 10.44 percent to $64.80 per barrel in June from $72.35 per barrel in May.

In far flung areas like Marsabit, a litre of petrol will sell as high as Sh121.81 per litre.

Fuel remains one of the most heavily taxed commodity with six levies and two taxes for petrol and diesel.