[caption id="attachment_7541" align="aligncenter" width="300" caption="Motorists queue for fuel at a petrol station. (Image: Capital FM)"][/caption]

Ever since energy industry regulator Energy Regulatory Commission (ERC) took over price controls for fuel, the essential commodity has been on the high end of the cost list.

On May 14th, the regulator increased the prices of  Super Petrol to KES 121.13 in Nairobi. The prices for diesel were reduced by a small margin of 36cts to retail KES 108.44 and  Kerosene went up by 72cts to retail at KES 87.00. This move was not received well by Kenyans who have been on the receiving end of the constant high cost of living due to the high prices of fuel.

Consumer watch group Consumer Federation of Kenya (COFEK) and the Federation of Kenyan Employers (FKE) have voiced their concerns about ERC regulating the oil industry which they say has caused more pain to the consumer than any good. Despite downward trends in international crude prices and stability of the local currency against the dollar, ERC has not dropped prices of fuel but has instead been having the products on the upward trend.

ERC however has said it expects the falling prices of crude to reflect in the prices of fuel to be released in June. The price of Murban crude oil has in the recent past been on a decline, going down to $121 a barrel in April from $126 per barrel in March.

The two organizations have called for the market to be controlled by marketers which will have consumers benefit from competition rather than have an exploitative system set by the law.

“Previously petrol stations charged different rates, which was to the benefit of business and consumers. These rates allowed for competition, which brought down general fuel prices.” Says Jacqueline Mugo, FKE Chief Executive Officer. ERC releases price guidlines every month for marketers which brought to light and all time high price of fuel in December 2011 that saw Super Petrol retail for up to Shs. 125 in Nairobi.