This archive report was first published on 14 October 2021.
On October 14, 2021, the Energy and Petroleum Regulatory Authority (Epra) reinstated fuel subsidy after State House intervention, cutting pump prices for the first time since June.
The move came after officials from the Ministry of Petroleum and Epra sought the intervention of State House for a return of the subsidy, which was dropped last month, amid fears that rising crude oil costs would push pump prices to a historic high.
According to Epra, the reinstatement of the subsidy led to a reduction in pump prices, with petrol and diesel prices cut by Sh5 per litre to Sh129.72 and Sh110.60 respectively in Nairobi, while kerosene dropped Sh7.28 to Sh103.54.
Earlier, the Treasury had revealed that it had exhausted the Sh31 billion set aside to subsidise fuel after it diverted Sh18.1 billion to support standard gauge railway (SGR) operations under Chinese operators.
“Despite the increase in landed costs, the applicable pump prices for this cycle have been reduced. The government will utilise the Petroleum Development Levy to cushion consumers from the otherwise high prices,” Epra said.
Simmering public anger over high cost of fuel, which has caught the attention of top politicians and the National Intelligence Service (NIS), prompted a flurry of meetings involving top officials at the Treasury, the Ministry of Energy and Epra ahead of the review.
