The Energy Regulatory Commission (ERC) is set to review fuel prices tomorrow – 14^th July 2012.

The previous fuel price review saw the price of super petrol decrease by Ksh 3.46, from Ksh 121.13 to Ksh 117.67, diesel decreased by 2.93, from Ksh 108.44 to Ksh 105.51 while that of kerosene decreased by Ksh 3.80, from Ksh 87 to Ksh 83.20. These were the overall fuel prices in Nairobi.

The drop in fuel prices was due to the price drop of the Free On Board (FOB) price of Murban crude oil lifted in May 2012. The price of Murban crude oil lifted in May 2012 was posted at USD 110.60 per barrel, a decrease of 8.75 per cent from USD 121.20 per barrel in April 2012.

We project a further drop in fuel prices following the continued decline in International crude oil prices. The Abu Dhabi National Oil Company posted the price of Murban Crude oil lifted in June 2012 at USD 97.35 per barrel, reflecting a 12 per cent price drop from USD 110.60 per barrel in May 2012.

Based on the above price movement and the relationship between price of crude oil in the international market and the prices set by ERC over the past 12 months, project the price of super petrol to drop to Ksh 103.74, diesel to Ksh 96.54 and kerosene to Ksh 73.08, please make an allowance of + or – Ksh 3 on these projected prices.

Our’s are just projected fuel prices, the energy regulator will post the exact fuel prices on 14^th July 2012. We will keep you posted on any developments.