NAIROBI, Kenya, Sep 15 – Kenyans will have to dig deeper into their pockets to purchase fuel starting Thursday, as the new government commences the gradual removal of the fuel subsidy.
In the latest monthly review by the Energy and Petroleum Regulatory Authority (EPRA), the price of petrol is up by Sh20.18 to retail at Sh179.30 per litre in Nairobi.
A litre of diesel will retail at Sh165, a Sh25 increase, while kerosene, mostly consumed by low-income households has increased by Sh20 retailing at Sh147.94 per litre.
EPRA said that although the subsidy for petrol had been removed, a subsidy of Sh20.82 per litre and Sh26.25 per litre had been retained for diesel and kerosene respectively in order to cushion consumers from the high prices.
The prices are inclusive of the 8 per cent Value Added tax in line with the provisions of the Finance Act 2018, the Tax Laws (Amendment) Act 2020 and the revised rates for excise duty for inflation as per Legal Notice No.194 of 2020.
During his inauguration President William Ruto said that he would phase out subsidies on fuel and food, arguing that they are a huge burden to the government’s budget and often lead to product shortages.
“The interventions in place have not borne any fruit,” Ruto said in his inauguration speech.
Kenya has been reeling from a global surge in crude oil prices and last year introduced measures to cushion consumers from the high fuel prices.
Official data shows that the government has spent over Sh144 billion in the past year to stabilize fuel prices.
The International Monetary Fund (IMF) has been pushing for the scrapping of the fuel subsidy.
In a recent report, the Bretton Woods institution said National Treasury had agreed to do away with the programme and would be slowly pulling out and allowing local prices to reflect the market realities such as the high crude oil cost and weak shilling.
