Kenya sees retail fuel prices falling this month
09 January 2012, 13:03
Nairobi - Kenyan retail fuel prices
are expected to fall next week when the energy regulatory
commission carries out its next monthly review, the regulator
said on Sunday, giving further traction to views that inflation
may have peaked.
Through this regulatory commission, the government sets a
maximum price per litre for retailers every month in order to
shield consumers from sharp jumps in prices.
High fuel prices for most of last year hit consumers hard
and together with a jump in food prices, pushed up inflation in
east Africa's biggest economy for the 13 straight months to the
end of November.
Kaburu Mwirichia, head of the regulatory commission, said
prices of Murban crude lifted in December fell slightly.
He added that the average exchange rate gained 7.4 percent
to 86.66 shillings per dollar in December from 93.64 in
November. A slump in the shilling for most of last year had
worsened the impact of high prices of crude.
"Taking these trends into account, the next price review due
on 15th January 2012 is expected to result in the reduction of
pump prices. The exact reductions will be announced after the
calculations are finalised," Mwirichia said in a statement.
Initial calculations by the commission showed that a litre
of petrol is likely to fall by 3.50-4.50 shillings from 119.06
shillings, it said.
Price per litre for kerosene and diesel may fall by
6.00-7.00 shillings from 90.74 shillings and 110.97 shillings
respectively, the commission said.
Officials introduced petroleum price controls in late 2010,
to protect consumers after pump prices soared, setting the
maximum margin for wholesalers at 6.00 shillings per litre and
3.00 shillings per litre for retailers.
The price caps have hit marketing firms hard. Total Kenya
, part of French oil major Total SA, blamed
them and other factors when it posted a 67 percent decline in
pretax profit for the first nine months of last year.
Although the nation of 39 million people has made economic
progress, analysts say its energy sector is a blight, with
expensive electricity accompanied by frequent blackouts and high
pump prices at petrol stations that sometimes run dry, feeding
into high costs of doing business.