Page 9 - DMEA Week 28 2022

DMEA POLICY & SECURITY DMEA

Kenya authorises additional fuel

subsidy to cushion impact of inflation

AFRICA PRESIDENT Uhuru Kenyatta has authorised Dena said retail pump prices in Nairobi
the release of an additional fuel subsidy of KES- would have been KES 193.64 for diesel, KES
16.675bn ($141mn) to cushion Kenyans from 209.95 for petrol and KES181.13 for kerosene
the impact of rising prices for refined petrol, die- without such state interventions of fuel subsidy.
sel and kerosene. The East African nation over Kenya has been a net importer of refined oil
the past year has spent over $860m to subsidise products since September 2013, when the Kenya
fuel. Petroleum Refineries Ltd (KPRL) in Mombasa
“With today’s presidential action, diesel will closed down after exhausting the last stock of
continue to retail at KES140, petrol at KES159.12 Murban crude imported from Saudi Arabia.
and kerosene at KES127.94 per litre in Nairobi,” Essar Energy of India and Kenya’s govern-
State House Spokesperson Kanze Dena said in ment each owned 50% of the plant. The closure
a press release on July 14. “His Excellency the led to scrapping a planned $1.2bn upgrade of
President (Kenyatta) understands that high fuel KPRL.
prices pose a significant challenge for every Ken- Oil products from KPRL were sold in Kenya,
yan household and collectively on the economy exported to Uganda, South Sudan, Rwanda,
and our way of life.” Burundi, northern Tanzania and eastern Dem-
The announcement came ahead of the ocratic Republic of Congo (DRC).
expected publication by the Energy Petroleum In response to the challenges, the government
Regulatory Authority (EPRA) of new record has over the last year implemented a fuel stabi-
high pump prices -- taking into the exchange lisation programme that has offered reprieve
rate of the Kenyan shilling to the US dollar, and to Kenyans at the pump through a subsidy of
rising sea transport and insurance costs -- after KES101.852 bn to date.
the Treasury announced that it would gradually “As a caring government, we will continue to
withdraw the fuel subsidy to ease pressure on roll out similar actions so as to provide further
government coffers. direct relief to all Kenyan families and estab-
Pump prices reflect the cost of pumping lish the necessary safeguards for protecting
refined fuel inland from the Mombasa seaport Kenyan consumers from further increases in
by pipeline to Nairobi and beyond by road trans- the cost of living,” said Dena, the State House
port, among other factors. spokesperson.™

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