Kenya’s energy regulator has raised the prices of super petrol and diesel by 28.69 shillings per litre and 40.3 shillings per litre respectively, blaming a surge in imported fuel costs for the hikes. The Energy and Petroleum Regulatory Authority announced that petrol now costs 206.97 Kenyan shillings ($1.60) per litre, while diesel stands at 206.84 shillings, triggering immediate ripple effects across the economy as transport fares shot up overnight.
Motorists rushed to fill up their tanks hours before the new prices took effect, causing long lines at service stations across the country. Minibuses raised fares by about 25 per cent, while bus operators increased fares by between $1.54 and $3.86. The ripple effects are expected to spread across the broader economy, as rising fuel costs drive up the price of goods and services, from food to manufactured products that rely on road transport for distribution.
Inflation stood at 4.4 per cent in March, slightly up from 4.3 per cent in February, with price pressures continuing to build. Kenya sources nearly all of its fuel from Gulf suppliers in Saudi Arabia, the UAE and Bahrain, making it highly vulnerable to geopolitical tensions in the Middle East and global supply chain disruptions. The country’s economy, which has shown resilience following a series of post-pandemic recoveries, now faces renewed pressure from energy costs that affect every sector.
For households, the fuel hike translates into higher costs for commuting, food, and basic goods. For businesses, particularly those in manufacturing, logistics, and agriculture, the increase in diesel prices raises production and distribution costs, potentially compressing margins or forcing price increases onto consumers. The timing is particularly challenging as Kenya continues to navigate the fiscal consolidation requirements of its IMF programme while protecting vulnerable households from the full impact of external shocks. The government’s ability to manage these competing pressures will determine whether inflation remains contained or begins to accelerate more rapidly.
