Daniel Kiptoo: Expect Further Drop In Pump Prices Until February 2024

• International fuel prices have been dropping significantly, currently retailing at $77.32 (KSh 11,900) per barrel
• Energy and Petroleum Regulatory Authority (EPRA) announced a reduction in pump prices for December 15, 2023, to January 14, 2024
• EPRA director-general Daniel Kiptoo noted the drop will be significant in February 2024 as fuel imported in December 2023 will be in the market

TUKO.co.ke journalist Wycliffe Musalia brings over five years of experience in financial, business, and technology reporting, offering deep insights into Kenyan and global economic trends.

Kenyans could soon enjoy reduced pump prices, as reflected in the international market.

Energy and Petroleum Regulatory Authority (EPRA) director-general Daniel Kiptoo said the drop in international fuel prices will be realised in February 2024.

What are the current pump prices?

This followed EPRA's review for December 2023 and January 2024, which saw the regulator lower petrol prices by KSh 5, diesel by KSh 2 and kerosene by KSh 4.01.

“The prices will continue dropping from this month as indicated by prices on the international market, until February 2024... only if other factors like the exchange rate do not interfere," said Kiptoo, as quoted by People Daily.

In an exclusive interview with TUKO.co.ke, Petroleum Outlets Association of Kenya (POAK) chair Martin Chomba explained that the oil Kenya is selling now was imported two months ago and will have a slight drop in prices.

He affirmed that a significant reduction in pump prices is expected in January.

"The fact that we buy petroleum products a month or two months earlier, the prices ought to go down, but not by a very big percentage in December. But in January, we expect the prices should go down by a bigger chunk, a more drastic drop," said Chomba.

Currently, super petrol, diesel and kerosene retail at KSh 212.36, KSh 201.47 and KSh 199.05 per litre, respectively, in Nairobi.

EPRA said the prices are pegged on fuel imported two months ago when the prices in the international market were still high.

According to Bloomberg, Brent Crude Oil, commonly used in Kenya, currently sells at $77.32 (KSh 11,900) per barrel in the international market.

Could the falling shilling affect fuel prices?

However, Kiptoo was categorical, saying that the continued depreciation of the Kenya shilling against the US dollar and taxation could still keep fuel prices on the roof.

“The prices of oil internationally have come down, but factors such as exchange rates will have an impact on the price plus taxes and levies,” Kiptoo warned.

According to the Central Bank of Kenya (CBK) data, the shilling traded at KSh 153.37 per US dollar as of December 14, 2023.

Most commercial banks have increased the dollar sales rate to over KSh 150.

The Kenyan shilling's depreciation is attributed to the high fuel prices and high interest rates by the US Federal Reserve.