International Oil Prices Rise
Anticipate an increase in fuel prices as international crude oil prices begin to rise. Latest statistics released by Abu Dhabi National Oil Company show that the Free On Board (FOB) price of Murban crude oil lifted in July 2012 increased by 4.5 per cent to retail at USD 101.75 per barrel, up from USD 97.35 per barrel in June 2012. The price increase could be attributed to mounting Middle East geopolitical risks.
Kenya Petroleum Refinery Limited (KPRL) first consignment of crude oil, following its upgrade to merchant status, was the Murban oil crude type. 82,000 tonnes of Murban crude oil was imported from Abu Dhabi during the first consignment which came in on July 2012.
In as much as it may be early to speculate how high local pump prices will rise, the Energy Regulatory Commission (ERC) is expected to calculate the maximum retail pump price of petroleum products, for the period beginning August 15th, to September 15th , based on trends in international oil prices.
The recent drop in international oil prices saw local fuel prices drop. The latest ERC fuel price review saw the price of super petrol, for instance, drop by KES 9.21, from KES 117.67 in June to KES 108.46 in July. This price drop was attributed to a 11.98 per cent decline in the FOB price of Murban crude oil in June 2012 as compared to May 2012
Other crude types whose prices increased in July include: L Zakum, Umm Shaif and U Zakum which retailed at USD 101.30, 101.05 and 99.85 per barrel respectively.
Below is the is Murban crude oil price trend as posted by Bloomberg:
