Petrol Should Be Ksh140/L: Kenya Motorists Association Explains
Petrol Should Be Ksh140/L: Kenya Motorists Association Explains
Petrol Should Be Ksh140/L: Kenya Motorists Association Explains
The 300,000-strong Kenya Association of Motorists contends that a litre of petrol should sell for Ksh140 instead of the current Ksh211. Peter Murima, the association’s head, claimed on Wednesday that the state’s meddling in price regulation was the primary reason for record price increases.
According to the current USD92 (Ksh13,404) per barrel costs, he continued, the price per liter should only rise to Ksh140 when taxes and other overhead levies are included. “Kenyans have now accepted their fate, but that does not imply we have no power. According to the current global prices and all the logistics involved in fuel distribution, the price of petrol should be Ksh140 per litre, according to Murima.
Murima stated that the state now requires an advance payment of taxes on the imported good, a fee that is then passed on to the consumer, as a result of the Energy Regulatory Commission (ERC) being renamed to the Energy and Petroleum Regulatory Commission (EPRA).”The government begins deducting charges from fuel as soon as it arrives before it is unloaded because it requires that all taxes be paid up front, forcing traders to take out loans to cover the taxes. The dealers now pass on that expense to the retail sector,” he continued.
In addition to the excessive and unreasonable taxes, any nation in the globe may be able to guarantee that energy is within reach, whether through subsidies or wise economic management that promotes economic expansion.Murima claims that the problems started in 2019 after ERC changed its name to EPRA, which he claims reduced the authority’s independence.He asserted that the state at the time invalidated a fuel price calculation method chosen by the then-independent ERC.”The government reneged the formula of calculating taxes adopted by the ERC which was independent and had independent commissioners,” he continued.
The government took over ERC and renamed it EPRA once the commissioners started to realize that there was influence. Today, which is incorrect, the government controls private firms.Murima claims that if the price is set by the market forces that control supply and demand, the price will be drastically reduced.He also criticized the government for eliminating the Ksh5 per litre subsidy that had been applied to all fuel sales. The chairman pointed out that the subsidies allowed for improved company planning and helped ensure pricing stability.
“As oil marketers compete, oil costs will undoubtedly decrease because drivers will shop around for the best deals. The justification that fuel costs have increased globally is untrue because they are still expected to be close to Ksh91 in three months and are now fluctuating around that amount, he continued.As of right now, a barrel of oil costs Ksh13,993, up from Ksh12,962 (USD88) on Monday.As a result, international experts have expressed concerns that inflation may soon affect Central Banks, who are in charge of controlling prices, around the world.
The supply imbalance revealed by Saudi Arabia and Russia, which reduced supplies from 1 million barrels per day to 500,000, is likely to make the inflation worse.After government officials also made hints that the price will likely reach Ksh260 per litre by February, fears spread throughout Kenya.
