International crude oil prices have dropped sharply ahead of the Energy and Petroleum Regulatory Authority (EPRA) monthly fuel price review, raising hopes that motorists could get some relief at the pump.
Data from the Central Bank of Kenya (CBK) shows that the price of Murban crude fell to KSh9,384.97 ($72.54) per barrel on August 6, down from KSh10,120.54 ($78.24) recorded on July 30.
The latest drop comes just days before EPRA is expected to announce new fuel prices for the period beginning August 15.
Motorists will be watching the review closely, particularly after the regulator maintained the current prices in its July review despite changes in the international oil market.
The CBK attributed the decline in crude prices to movements in global markets amid continued uncertainty linked to tensions in the Middle East.
“Commodity prices recorded mixed movements, with Murban crude oil prices declining to USD 72.54 per barrel on August 6, from USD 78.24 per barrel on July 30,” the CBK said in its weekly bulletin.
The decline in crude prices could put pressure on EPRA to lower pump prices if other factors used in calculating fuel prices remain favourable.
However, the final prices will also depend on the cost of imported petroleum products, the exchange rate and taxes, among other factors.
Current Fuel Prices
EPRA maintained the prices of petrol, diesel, and kerosene during the period from July 15th to August 14th.
In Nairobi, a liter of super petrol is priced at KSh214.03, diesel at KSh222.86, and kerosene at KSh191.38.
According to the body, this move was made in light of actions taken by the government in protecting consumers from volatility of international oil prices.
The government extended the 8 per cent Value Added Tax (VAT) on petroleum products for another three months to October 2026.
EPRA also said KSh945 million from the Petroleum Development Levy Fund was used to help stabilise fuel prices.
The previous review had already recorded a significant decline in the average landed cost of imported fuel.
The cost of super petrol fell by 21 per cent to KSh115,070 per cubic metre, while diesel dropped by 19.8 per cent to KSh127,700 per cubic metre. Kerosene declined by 11.7 per cent to KSh133,370 per cubic metre.
Shilling Remains Stable
The performance of the Kenya shilling could also play a role in the next fuel price review.
According to CBK statistics, the value of the shilling maintained its stability to the dollar at KSh129.41 from KSh129.40 from the previous week.
Foreign exchange reserves of the country were estimated at KSh1.97 trillion ($15.25 billion), which equates to 6.3 months of import cover.
Furthermore, the CBK indicated that the money market remained liquid for the week, whereby there was a higher demand than the supply of Treasury bills.
Kenya’s Eurobond yields also declined, pointing to some stability in the financial markets despite continued uncertainty in the global economy.
For motorists, however, the key focus will be EPRA’s announcement next week and whether the recent fall in international crude prices will translate into lower pump prices in Kenya.
