The average price of Super Petrol, Diesel, and Kerosene increased by Sh3.40 per litre, Sh6.40 per litre and Sh15.19 per litre respectively.
According to the latest review by the Energy & Petroleum Regulatory Authority (EPRA), the increase is attributable to the average cost of imported refined petroleum products, which has seen the landing cost of imports varying in price.
As a result, the review is on track to hit a record high, setting up the first big cost-of-living challenge for the Kenyan government.
The landing cost of super-petrol increased by 8.63% in March 2023, Diesel decreased by 2.51% and kerosene dropped to 1.13%.
In Nairobi, super petrol will retail at Sh182.70 for Petrol prices per litre, while Diesel and Kerosene have increased to Sh168.40 and Sh161.13 respectively.
However, the subsidy on Diesel and Kerosene has been removed.
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.
On the other hand, Kenya’s annual headline inflation printed at 7.9% in April 2023—the lowest level since May 2022.
Analysts note that cumulative policy actions taken by the Central Bank of Kenya (CBK) since the policy tightening cycle began in May 2022 —could be bearing fruit.
However, inflationary pressures remain aggravated by the upward adjustment of electricity tariffs effective 1st April.
Month-on-month, the price of 50-kilowatt and 200-kilowatt electricity rose by an average of Sh 485.14. Year-on-year, electricity prices have risen exorbitantly, increasing by an average of 54.50%.
“We commend the government’s move to eliminate the fuel subsidies to ease the expenditure and ensure fiscal consolidation,” according to Cytonn Investments.
However, we maintain the view that the government needs to implement long-term strategies to buffer foreign reserves and resuscitate the currently weakened interbank forex market, with the Kenyan shilling having recorded an 11.4% depreciation on year to data basis.’
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