The latest fuel price review saw the price of super petrol, diesel and kerosene drop by margins never seen before in ERC’s history of regulating fuel prices. The price of super petrol for instance drop by Ksh 9.21, from Ksh 117.67 to Ksh 108.46, while that of kerosene dropped by Ksh 8.8, from Ksh 83.20 to Ksh 74.40. The fuel price was expected to be a relief to the local mwananchi (citizen) who has for the longest time had to cope with high costs of living, but current events beg to differ.
The drop in fuel prices has resulted in concerns being raised that some retailers were hoard fuel while other stations are yet to lower their pump prices, claiming that they bought fuel at a higher price, dropping their prices would mean selling at a loss.
In a meeting with the parliamentary committee on Energy held on July 17, Tuesday, Energy permanent secretary Patrick Nyoike said dealers who refuse to reduce their fuel prices to comply with the recent fuel price review should be arrested and prosecuted in the court. He further added that the government shall not entertain any excuses raised for not lowering fuel prices.
In accordance with Legal Notice No. 196, The Energy (Petroleum Pricing) Regulations, 2012, the Energy Regulatory Commission (ERC) calculates the maximum retail pump prices of petroleum products. The purpose of the fuel pricing regulations is to cap the pump prices of the products, which are already in the country, such that the imported and other prudently incurred costs are recovered while ensuring fair prices to the consumers. Oil marketing companies which refuse to lower their pump prices in accordance with fuel price review are liable to a fine of upto Ksh 0ne million or the withdrawal of their operating licence or both.
In regard to the fuel shortage reported in some parts of the country, the energy PS stated that the shortage may have nothing to do with the reduction in prices, but challenges that the pipeline is experiencing due to power outages that have caused congestion and rescheduling of ships bringing in oil to Kenya. He further added that Kenya relies on a very old pipeline which experiences hitches from time to time.