A report by the Central Bank of Kenya (CBK) has forecasted a decrease in fuel prices in 2024 due to the expected decline in the international market.
The economic projection for the year, as outlined in the 53rd Monetary Policy Statement, indicated that international oil prices are anticipated to decrease by 2.3 per cent this year.
Furthermore, the report noted that a similar decline would be observed in 2025.
"World trade growth is expected to increase in 2024 to 3.3 per cent based on assumptions that fuel and nonfuel commodity prices will decline in 2024 and 2025 and that interest rates will decline in major economies.
"Annual average oil prices are projected to fall by about 2.3 per cent in 2024, whereas nonfuel commodity prices are expected to fall by 0.9 per cent," read the report in part.
However, it was noted that the expected price drop could be hampered by ongoing global dynamics such as the conflict between Israel and Hamas.
CBK explained that the conflict would affect the supply chain and in turn, lead to increased prices as dynamics for supply and demand shift.
Notably, concerns have been expressed over the delays in shipping which have been witnessed in recent months. The delays have been occasioned by the attacks on ships along the Red Sea by Houthi.
"There are still a lot of uncertainties arising from new commodity price spikes from geopolitical shocks including continued attacks in the Red Sea," read the report in part.
Fuel Prices
Fuel prices in the country have witnessed a downward trend since the start of the year. In January, Super Petrol and Diesel prices were reduced by Ksh5 while Kerosene was reduced by Ksh4.82 per litre.
In the following month, motorists enjoyed a decrease of Ksh1.
Currently, a litre of Super Petrol and Diesel is sold at Ksh206.36 and Ksh195.47 respectively in Nairobi. Kerosene is retailing at Ksh193.23 per litre.
Meanwhile, The Energy and Petroleum Regulatory Authority (EPRA) is expected to release new pump prices on Thursday, March 14.
