The Energy and Petroleum Regulatory Authority (EPRA) is set to release retail petroleum prices from June 15th, 2023, to July 14th, 2023. In their latest monthly report, the fuel prices of super petrol, diesel, and kerosene increased to kshs 182.7, kshs 168.4, and kshs 161.1, up from kshs 179.3, kshs 162.0, and kshs 145.9 per litre, respectively.
The increase in prices on fuel was on the back of the increase in landing cost for Super Petrol to USD 724.0 per cubic meter in April 2023 from USD 666.1 per cubic meter in February and the government’s decision to completely remove the subsidy on Kerosene and cross-subsidize Diesel with Super Petrol.
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With the fuel subsidy removed, the retail price of fuel is expected to be more susceptible to changing macro-economic factors such as changes in average landing costs, the performance of Kenya shilling against the US dollar, and most importantly, the free on board (FOB) price of Murban crude oil.
Kenya’s economy relies on fuel for transport, powering farm machinery, and generating electricity. Additionally, manufacturers and service providers factor in pump prices when setting prices for goods and services.
Therefore, the change in fuel prices will definitely have an effect on the rise or fall of the inflation rate in the country, which currently stands at 8.0% as of May 31, 2023.
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