The Lower Eastern Times Opening The Third Eye
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The Kenya National Chamber of Commerce and Industry (KNCCI) has cautioned that the recent rise in fuel prices is likely to increase the cost of living, reduce business profits and hurt Kenya’s competitiveness within the region.
In a statement, KNCCI President Erick Rutto expressed concern over the steep increase in diesel prices, noting that the fuel plays a major role in sectors such as transportation, manufacturing, agriculture, construction and logistics.
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His remarks came after the latest fuel price review by the Energy and Petroleum Regulatory Authority (EPRA), which increased the cost of super petrol by Sh16.65 per litre and diesel by Sh46.29 per litre.
Under the new pricing, a litre of super petrol in Nairobi will now retail at Sh214.25, while diesel will sell at Sh242.92 per litre.
KNCCI acknowledged that global crude oil prices had gone up following geopolitical tensions in the Middle East, but argued that diesel prices in Kenya had risen more sharply than the increase in international oil prices.
The chamber pointed out that diesel prices locally jumped by 23.5 percent between April and May, compared to a global crude oil increase of around 10.7 percent during the same period.
The business lobby further noted that Kenya continues to rank among the most expensive fuel markets in the region, with diesel prices remaining higher than those in neighboring countries such as Uganda and Tanzania.
According to KNCCI, the latest fuel hike is expected to increase transport and logistics expenses by between 10 and 20 percent, trigger higher food and commodity prices, raise production and distribution costs for farmers and manufacturers, and squeeze profit margins for micro, small and medium-sized enterprises (MSMEs).
The chamber has now called on the government to reassess fuel taxes and levies, enhance fuel price stabilization mechanisms, improve transparency in pricing, and tackle inefficiencies in fuel distribution and logistics systems.
KNCCI also urged authorities to fast-track investments in local and regional oil refining capacity to reduce dependence on imported refined petroleum products.
