Fuel Prices to Go Up In The Coming Months, Here Is Why

Consumers are likely to pay more for fuel in the coming months following Russia’s plan to cut its oil production from next month.

Russia Deputy Prime Minister Alexander Novak on Friday revealed that the country will from March cut oil production by 500,000 barrels per day, or around 5 percent of its total output.

His sentiments follow plans by Western nations to impose price caps on Russian oil and oil products in a move that was geared towards weakening  Moscow’s ability to fund its war on Ukraine.

“In relation to this, Russia will voluntarily reduce production by 500,000 barrels per day in March. This will contribute to the restoration of market relations.” Said Novak.

Russia is the third-largest oil producer and exporter in the world after Saudi Arabia and the United States. While Russia’s oil is not known to come to Kenya, analysts say a cut in production means a scarcity of the commodity globally as countries scramble for barrels from other sources such as the Middle East.

Kenya sources most of its oil imports from the Middle East, which is also a favorite source for other countries such as Europe, the United Kingdom, and other Western nations. The subsequent low production will see crude oil prices elevated, pushing up pump prices which have been on a rising spree in recent months.

High Crude oil prices will see the Energy and Petroleum Regulatory Authority (EPRA) hike the pump prices in the next price review unless the government cushion Kenyans from the price upsurge.

Fuel prices have remained unchanged in December and January as the regulatory body steps to cushion consumers from a higher cost of the commodity amid the high cost of living. In the two months, a liter of Super Petrol has been retailing at 177 shillings, Diesel 162, and Kerosene at 145.9 shillings respectively.

The government retained subsidies on diesel and kerosene to prevent a surge in the retail prices of the two products up to Tuesday, February 14.

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