In its new announcement, ERC noted that the new maximum retail pump prices of petroleum products will be in force starting January 15th to February 14th in 2019.
The new prices have seen Super Petrol, Diesel and kerosene now retail at Sh9.33 ($0.092), Sh10.04 ( $0.099) and Sh3.53 ($ 0.035) per litre less than the previous respectively.
“The changes in this month’s prices have been as a consequence of the average landed cost of imported super petrol decreasing by 14.87 per cent from $ 694.18 per ton in November 2018 to $590.92 per ton in December 2018. Diesel decreasing by 14.87 per cent from $722.17 per ton to $615.97 per ton and kerosene decreasing by 8.62 per cent from $678.57 per ton to $620.05 per ton.” A statement signed by ERC’s Director General Robert Oimeke,
The Pricing Regulations stipulates the formula that ERC uses in determining the maximum retail pump prices of Super Petrol, Regular Petrol, Diesel and Kerosene (the Regulated Products). The formula mirrors the petroleum value chain from importation, refining, storage, transportation through to retailing.
According to data from the ERC, Kenya has a total of 94 Oil Marketing Companies that participate in the importation of petroleum products for Kenya and the Great Lakes region whose demand is approximately 3,000,000,000 litres per year. Importation of these products is through the Open Tender System (OTS) every month. The OTS allows oil marketing companies to access petroleum products at the competitive prices and therefore ensure a level playing field in the petroleum market.
In computing maximum prices for petroleum products, the Commission takes into account landed cost of petroleum products as procured through the OTS, exchange rate against the dollar, distribution cost, marketer’s margins, taxes and levies.