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Commodity Watch

Smiles at the Pump as the Common Man in the Streets Continues to Cry

BY Soko Directory Team · April 18, 2016 07:04 am

Users of Super Petrol have every reason to smile after the Energy Regulatory Commission announced a drop in the prices of the product by more than four shillings. The price of petrol has now dropped to the lowest in a period of six years to 80.71 shillings per liter in Nairobi.

In the new prices announced by ERC, Petrol will NOW retail at 4.87 shillings per liter lower for the next one month before another review by the commission. Motorists who use petrol have expressed their joy and are hoping that the trend will continue. The prices of fuel have been going down globally.

 

Users of diesel on the other hand were not lucky this time round as the commodity went up by 0.53 shillings ion every liter to retail at 66.23 shillings per liter in Nairobi. Diesel is very crucial in the running of day to day activities for it is the one that is widely used in running industry engines, buses and most transport vehicles.


Almost 50 percent of Kenyans use kerosene for lighting and heating. The commodity has now gone up by 1.81 shillings per liter to retail at 43.96 shillings in Nairobi. According to the ERS, the varying prices this month are as a result of varying importing costs for each commodities. Kenya no longer imports crude oil after the main refinery in Changamwe was closed down and, therefore, often import finished products and has not widely enjoyed the low global prices of crude oil.

 

The Kenyan fuel prices are always behind the global prices by one month as a result of the duration taken to order the product and the delivery. The duration is often 30 to 40 days hence the different prices in Kenya as compared to other countries.

Has the common man benefitted from the low fuel prices?

Kenya is a free market. This implies that the buyer is always at the mercy of the seller. There is no rule or law that dictates the price of commodities in relation to the fluctuating global fuel prices. Fuel prices have been dropping for six years now but this has not changed the lives of the common people in the streets. Diesel for instance is often used to run most of the machines in many industries as well as used in the transport sector. Despite the fact that the price of diesel has been retailing at its lowest, prices of commodities have been skyrocketing each coming day. Maize flour, the commodity that is consumed by most of Kenyans and one that often plays a major role in determining the rate of inflation in the country, its price has continued to rise placing a huge burden on most Kenyans.

Article by Juma Fred.

 

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system. Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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