While fuel prices have decreased marginally in 2024, they remain high with taxes taking up to between 36% – 45% of the total retail prices, slightly higher than the landing costs, especially for petrol.
- •In the December fuel review, taxes and levies charged for a litre of petrol accounted for 45.7% of the total retail price, 41.5% for a litre of diesel and 36.6% for a litre of kerosene.
- •In the latest monthly fuel review, the Energy and Petroleum Regulatory Authority (EPRA) reduced pump prices for the next 30 days, to lowest levels since March 2023.
- •Consumers will pay KSh 176.29 per litre of petrol, of which KSh 80.50 is remitted to the taxman. For the KSh 165.06 per litre of Diesel, KSh 68.53 will go to taxes and levies. Kerosene will retail at KSh 148.39 a litre, of which KSh 54.34 is remitted to the tax authority.
The average landed cost of imported Super Petrol decreased y 4.46% from US$641.14 per cubic metre in October 2024 to US$612.53 per cubic metre in November 2024, Diesel increased by 5.76% from US$608.61 per cubic metre to US$643.69 per cubic metre while Kerosene increased by 1.87% from US$648.15 per cubic metre to US$660.3 per cubic metre over the same period.
Currently, Kenya imports all its petroleum product requirements in refined form and the products are traded in international markets based on a pricing benchmark.
Members of parliament approved a proposal by the government to raise the road maintenance levy to KSh 25.00 from KSh 18.00 for diesel and petrol. The approval will see the Kenya Revenue Authority mobilize about KSh 115 billion from a previous KSh 83 billion with the levy expected to cover road maintenance across the country.
Global oil prices have inched lower in the year as supply outweighed demand amid geopolitical tensions in the Middle East and weaker demand in China. Kenya’s benchmark – Murban Crude was selling at US$73.41 a barrel on Friday, 4.6% lower than US$76.97 a barrel at the beginning of 2024.
Lower fuel prices have offered relief from high inflation as many Kenyans rely on Petrol and Diesel for transport. The November inflation rate was 2.8%, from highs of 7% in mid 2023.
The Kenyan shilling is off an all-time low of 160 to the US dollar in January, currently ranging at the 129 mark for 4 months now making it less expensive to import refined fuel.
The government charges 2 taxes and 7 levies on fuel including Excise Duty, Road Maintenance Levy, Petroleum Development Levy, Petroleum Regulatory Levy, Railway Development Levy, Anti-adulteration Levy, Merchant Shipping Levy, Import Declaration Fee and Value Added Tax.