Fuel prices jump in Kenya after subsidies cut

Fuel prices jump in Kenya after subsidies cut

Fuel prices jump in Kenya after subsidies cut

Fuel prices in Kenya surged to record highs yesterday after the new government slashed subsidies, piling on misery for a population already facing deep economic hardship.

The price of petrol increased by 20 shillings to 179.30 (about $1.50) per liter while diesel and kerosene prices are up by 20 and 25 shillings respectively, the Energy and Petroleum Regulatory Authority (EPRA) said.

The new price regime that will remain in force until October 14 was announced shortly after Kenya’s new President William Ruto took office on Sept. 13 vowing to scrap food and fuel subsidies.

“The interventions in place have not borne any fruit,” Ruto said in his inauguration speech.

Kenya is reeling from the global surge in crude oil prices and last year introduced measures to cushion consumers from the high retail prices.

It has so far spent 144 billion shillings ($1.2 billion), about 86 percent of tourism earnings this year, to subside fuel, according to government figures.

Ruto lambasted the policies of his predecessor Uhuru Kenyatta, saying they gobbled up billions of shillings with no impact.

“In addition to being very costly, consumption subsidy interventions are prone to abuse, they distort markets and create uncertainty, including artificial shortages of the very products being subsidized,” he said.

Under the new prices announced by EPRA, the subsidy for petrol has been removed while those for diesel and kerosene have been reduced.