As Kenyan motorists face record-high fuel prices in the latest pricing cycle, pressure is intensifying on the government to adopt more aggressive measures to lower the cost of living.
Effective May 15, 2026, the Energy and Petroleum Regulatory Authority (EPRA) announced significant increases in pump prices. Super Petrol rose by KSh 16.65 to retail at KSh 214.25 per litre, while diesel saw a sharp hike of KSh 46.29, reaching a record KSh 242.92 per litre in Nairobi. Kerosene prices remained unchanged at KSh 152.78.
These increases follow a turbulent period for Kenyan fuel consumers, characterized by volatile global oil markets and a complex domestic tax structure.
Proposed Solutions vs. Government Action
Kiharu Member of Parliament Ndindi Nyoro has been among the most vocal critics of the current pricing, recently proposing a roadmap he argues could reduce pump prices by at least KSh 27 per litre. His proposal centers on three pillars:
- VAT Reduction: Demanding that fuel products be fully exempted from Value Added Tax (VAT) or that the rate be significantly reduced.
- Levy Removal: Abolishing the KSh 7 road maintenance levy introduced in 2024.
- Enhanced Subsidies: Injecting an additional KSh 5 billion from the Fuel Stabilisation Fund to cushion consumers.
While the government has implemented some interventions—including a temporary reduction of VAT on petroleum products from 16% to 8% in mid-April 2026 and the deployment of KSh 5 billion from the Petroleum Development Levy Fund for the current cycle—critics like Nyoro argue these efforts remain “overwhelmingly inadequate” in the face of the current economic strain.
Central to the ongoing debate is the Government-to-Government (G2G) fuel importation arrangement, initiated in 2023 to stabilize the shilling and secure fuel supplies.
While the government maintains that the G2G deal has been instrumental in ensuring a steady fuel supply and preventing the kind of shortages seen in 2022, it has faced intense scrutiny. Critics label it a “scam” that benefits a few, citing concerns over transparency and the high cost of fuel despite lower global oil prices compared to 2022. Government officials, however, have defended the framework as a necessary tool that has successfully shielded Kenya from deeper price shocks and currency volatility.
The rising cost of fuel is rippling through the economy. With transport costs and inflation under significant pressure, the International Monetary Fund (IMF) has revised Kenya’s 2026 growth forecast downward, noting that fuel import costs pose a central risk to the country’s economic stability.
As the new prices take effect and remain in force until June 14, 2026, businesses and households alike are bracing for continued strain, with policymakers under mounting pressure to find a sustainable balance between fiscal responsibility and consumer relief.
