The Petroleum Outlet Association of Kenya, a key stakeholder in the energy sector has hinted that fuel prices are likely to fall in the next price cycle.
Speaking to the media on Wednesday, September 21, Martin Chomba the Chair of POAK said the organisation of Petroleum exporting countries - OPEC basket prices will open in late September.
“If you look at this and study the world market of prices the crude that we consume, prices have started plummeting. We have come from the highs of about 120 dollars barrel to the current 80 something dollars per barrel,” Chomba stated.
He further noted that Kenyans will have to wait until the beginning of November- December Cycle to begin feeling a sigh of relief in fuel price due to a decline of pump prices in the global market.
Currently, Kenyans are confronting the cost of living, compounded by a spike in pump prices, following a review by the Energy and Petroleum Regulatory Authority ( EPRA).
Currently, a litre of Super Petrol is going for Ksh179.30 after it increased by Ksh20. Diesel increased by Ksh25 to Ksh165 while Kerosene rose by Ksh20 to Ksh147.94 in Nairobi.
The high fuel prices saw Matatu operators increasing fares across the country, with commuters being forced to dig deeper into their pockets.
Chomba stated that the government has always argued that it takes time to prepare the Subsidy invoices terming it laborious.
“The government has always argued that this subsidy invoices is a laborious one that takes time and that's why the say it's the reason for the delay,” Chomba stated
On the other hand, Oil Marketers claimed that as of September 20, the government owed them Ksh44 billion in subsidy arrears, despite settling Ksh16 billion on September 19th.
Additionally, Oil Marketing companies say that Kenyans can get a sigh of relief from the high cost of fuel beginning November to December.
Central Bank of Kenya (CBK) Governor Dr Patrick Njoroge during the induction of MPs projected that fuel prices will drop by December despite President William Ruto ending the subsidy.
He said that the Prices will drop because of the normalcy being experienced in countries that produce oil products.
On Thursday, September 22, global oil prices rose as supply fears outweighed recession worries.
The rebound was after sliding one per cent in the previous session as concerns rose over tight supplies heading into winter.
According to Reuters, brent crude futures rose 15 cents, or 0.2%, to Ksh10,847.09 per barrel by 0657 GMT, recouping their losses in early Asia trade. U.S. West Texas Intermediate (WTI) crude rose 10 cents to Ksh10,053.87
"The Fed delivered the third 75bp hike yesterday, as expected. Markets cheered the decision, as a 75bp hike is better than a 100bp hike," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank in a note.
