Energy Regulatory Commission (ERC) yesterday reviewed fuel prices, lowering pump prices for super petrol, diesel and kerosene by KES 3.46, KES 2.93 and KES 3.80 per litre respectively. Super petrol will now retail at KES 117.67, diesel at KES 105.51 and Kerosene at KES 83.20.
So, what factors brought down pump prices?
For starters, the Free On Board (FOB) price of Murban crude oil that went up in May 2012 decreased by 8.75%. It was posted at US $ 110.60 per barrel, from US $ 121.20 per barrel in April 2012.
The average landed cost of imported super petrol decreased by 7.50%, from US $ 1,235.56 per tonne in April 2012 to US $ 1,142.89 per tonne in May 2012. Over the same period, the average landed cost of imported diesel decreased by 2.06% from US $ 1,059.66 per tonne in April 2012 to US $ 1,037.81 per tonne in May 2012. The average landed cost of imported kerosene also decreased by 8.76% from US $ 1,117.26 per tonne in April 2012 to US $ 1,019.44 per tonne in May 2012.
The imported price changes are summarized in the table below:
The pump prices would have been lower if it were not for the mean monthly exchange rate which deteriorated marginally, by 1.8%, to KES 84.74 per US $ in May 2012 compared to KES 83.24 per US $ in April 2012.
Nonetheless, a drop in pump prices will definitely contribute in cutting down costs of living.