Johannesburg, South Africa — Kenya’s fuel market has experienced a dramatic uptick in prices, with diesel costs skyrocketing by a record 40 Kenya shillings to 206 shillings per litre, despite the government’s recent Value Added Tax (VAT) reduction from 16% to 13%. This paradoxical situation has left consumers bewildered and concerned about the economic impact of the ongoing conflict in Iran.
The Energy and Petroleum Regulatory Authority (Epra) has cited global oil supply disruptions stemming from the Iran conflict as the primary driver behind the price surge.
The landed cost of imported fuel has seen a significant increase, with petrol prices up by 41. 53% and diesel by 68. 72% between February and March 2026.
The closure of the Strait of Hormuz, a critical oil transit route, has further intensified supply disruptions, exacerbating the situation.
The Kenyan government had aimed to alleviate consumer burden by cutting VAT, but officials now admit that the measure was not enough to counteract the global price surge.
The Epra has highlighted geopolitical tensions and supply disruptions as the main causes of the price hike. Analysts caution that the fuel price increases could have a ‘snowball effect’on food, transport, and manufacturing costs, potentially spurring inflation.
As Kenya grapples with these challenges, the nation awaits further developments and potential policy adjustments to address the soaring fuel prices and their far — reaching economic implications.
*Additional reporting by ImNews | Sources consulted: 5*
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By This original article was produced by the ImNews editorial team
Source: BBC Africa
