Here is RUTO’s blunder that has seen the abnormal rise of petrol price to a record Sh211 in just one year

 

Thursday, September 21, 2023 – The price of petrol in Kenya should be Sh140 not the Sh211 per litre that President William Ruto announced last week.

This is according to the Kenya Association of Motorists, which has a membership of 300,000.

In an exclusive interview, the association’s chairman Peter Murima stated that the state’s interference in regulating the price was the main cause of record price hikes. 

He added that according to the prevailing barrel prices of USD92 (Ksh13,404), the price per litre should only increase to Ksh140 when taxes and other overhead levies are added. 

“Kenyans now have resigned to fate which does not mean we do not have power. The rate of fuel right now should be at Ksh140 per litre going by the world prices as well as all the logistics that involve the fuel dispensing,” Murima stated.

Murima explained that since renaming the Energy Regulatory Commission (ERC) to the Energy and Petroleum Regulatory Commission (EPRA), the state now demands an upfront payment of taxes on the imported product, a charge that is then transferred to the consumer.

The trouble, according to Murima, began in 2019 after ERC rebranded to EPRA which he argues limited the authority’s independence.

He claimed that at the time, the state discredited a formula for calculating the fuel price agreed upon by the then-independent ERC.

According to Murima, the price will significantly reduce if the price is determined by the market forces that regulate demand and supply.

He also faulted the state for removing the subsidy which is charged on all fuel sales at the rate of Ksh5 per litre.

The chairman noted that the subsidy helped guarantee stability in prices and enabled businesses to plan better.