Three-year high fuel prices ig­nite in la­tion fears

Mo­torists to pay Sh102.70 per litre of petrol in Nairobi, up from Sh101.67

Business Daily (Kenya) - - FRONT PAGE - Neville Otuki no­tuki@ke.na­tion­media.com

Fuel prices have hit a three­year high, set­ting con­sumers up for a fresh bout of in la­tion pres­sures amid higher global oil prices..

Fuel prices have hit a three­year high, set­ting con­sumers up for a fresh bout of in­fla­tion pres­sures amid higher global oil prices.

Diesel will from to­day cost Sh3.70 more per litre, petrol is up by Sh1.03 a litre while kerosene is up Sh5.05. The in­creases will see mo­torists pay Sh102.70 per litre of petrol in Nairobi, up from Sh101.67 while diesel will cost Sh92.41 a litre from Sh88.71 at the city pump.

Kerosene, used by poor homes for cook­ing and light­ing, is up Sh5.05 to Sh71.23 a litre in the city, ac­cord­ing to the lat­est ad­just­ment by the En­ergy Reg­u­la­tory Com­mis­sion (ERC). The new prices will be in place

Kerosene, used by poor homes for cook­ing and light­ing, is up Sh5.05

for the next one month un­til De­cem­ber 14 when they are re­viewed again.

Fuel costs have climbed for the past three con­sec­u­tive months to stand at the high­est point since Novem­ber 2014 when petrol cost Sh106.80 a litre while diesel went for Sh94.52. This is set to ex­ert up­ward pres­sure on in­fla­tion in an econ­omy that re­lies on diesel to power agri­cul­tural ma­chin­ery, in­dus­tries and com­mer­cial ve­hi­cles while the costlier kerosene will hurt poor homes’ bud­gets.

The ERC con­trols the max­i­mum petroleum prices through the monthly ad­just­ments based on fluc­tu­a­tions in global crude oil prices, freight costs and forex mar­ket. Kenya im­ports all its petroleum cargo.

In­fla­tion last month eased to a 16-month low of 5.72 per cent due to fall­ing food prices. The en­ergy reg­u­la­tor said the av­er­age landed cost of im­ported petrol rose 1.42 per cent per tonne, the cost for diesel was up 6.31 per cent while kerosene’s rose 8.12 per cent.

Petroleum prices cur­rently vary across Kenya due to trans­port costs that re­flect how far a lo­ca­tion is from Mom­basa port where im­ported con­sign­ments land and are stored. Mom­basa con­sumers will pay the low­est at Sh99.42 per litre of petrol fol­low­ing the lat­est price ad­just­ment and Sh89.13 for diesel.

Petrol is most ex­pen­sive in the north­east­ern town of Man­dera and mo­torists will pay Sh116.51 a litre, or Sh17 more than in Mom­basa, while diesel will cost 106.21.

Diesel con­sump­tion in Kenya stood at 1.24 bil­lion litres in the six months to June, translating to an av­er­age in­take of 206 mil­lion litres monthly. Petrol, mostly used in pri­vate cars, stood at 836.4 mil­lion litres in the hal­fyear pe­riod, or 139 mil­lion litres per month.

FILE

EN­ERGY Fuel costs have risen for the past three con­sec­u­tive months to stand at the high­est point since Novem­ber 2014.

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