By Macharia Kamau
The Energy Regulatory Commission Wednesday increased prices of super petrol and kerosene while marginally reducing that of diesel. It is the first time since November 2011 that ERC has increased pump prices.
In its monthly price review, the energy regulator attributed the increases to recent increases in the price of crude and refined petroleum products in the international markets but noted the strengthening of the local currency had helped and seen the increases being marginal.
During the period between March 15 and April 14, super petrol will now retail at Sh111.69 in Nairobi after ERC adjusted its price upwards by 39 cents, while Kerosene will retail at Sh84.13 after its price was increased by 37 cents.
Price of diesel was reduced by 17 cents and will now retail at Sh105.12 in Nairobi down from Sh105.29. Prices for other towns have also been adjusted, with those far from Mombasa which is the receiving point for petroleum products paying more for fuel.
"In the last several months, there has been a general upward trend in the price of crude and refined petroleum products in the international market. This may have a negative impact on price reviews," said Kaburu Mwirichia director general ERC in a statement.
"Recently the local currency has continued to strengthen relative to the US dollar and this has impacted positively on local pump prices."
Crude oil prices rose from an average of $114 per barrel in January to $120 in February. It has gone further up to the $125 range in the course of this month. Rise in price of crude oil has mostly been on the back of increased demand from major consumers including United States and China.
In the recent months, the shilling has strengthened against the dollar and went up to trade at an average rate of Sh83 during the month of February compared to Sh85 in January and a high of Sh107 last October.
A weak shilling was mostly blamed for the high pump prices witnessed in the country throughout last year where a litre of petrol went up to Sh124 in Nairobi. This was despite a general decline in prices of oil in international markets.
The economy is highly dependent on petroleum products for transport, manufacturing, power production, agriculture and other key industries and change in prices of fuel is usually reflected in the cost of living.
Inflation has come down in the recent past, which has been partly attributed to reduced fuel prices and further decline has been pegged on a sustained reduction in fuel prices.