Fuel Prices Won’t Fall Overnight Despite Middle East Calm, Wandayi Explains as Kenyans Told When Relief Could Come
Kenyans hoping for an immediate drop in fuel prices following signs of stability in the Middle East may have to wait a little longer, Energy Cabinet Secretary Opiyo Wandayi has said.
Speaking during an interview on NTV on Monday, June 15, Wandayi explained that while easing tensions in the oil-rich region could eventually lower global fuel prices, Kenya’s pricing formula means consumers are unlikely to feel the full benefits immediately.
Instead, the Cabinet Secretary indicated that motorists and households could begin seeing more significant reductions at the pump from August, provided stability is maintained and shipping operations through the strategically important Strait of Hormuz return to normal.
The Strait of Hormuz, which connects the Persian Gulf to global markets, handles more than one-fifth of the world’s oil supply. Any disruption along the route often sends crude oil prices soaring, with ripple effects felt across economies worldwide, including Kenya.
According to Wandayi, recent reports suggesting progress in diplomatic engagements between the United States and Iran, alongside expectations of uninterrupted movement through the strait, are positive developments for global energy markets.
However, he cautioned that Kenya’s fuel pricing mechanism operates with a built-in delay, meaning international price changes take time to filter through to local consumers.
“When the situation in the Middle East stabilises and there is a resumption of normal supply along the Strait of Hormuz, we will be able to see the benefits come down to consumers, but it cannot be instant,” Wandayi said.
The CS explained that fuel imported into Kenya during a particular month is priced using international benchmark prices from the previous month, creating a lag between movements in global oil markets and adjustments in local pump prices.
“Fuel that is discharged in month X is priced against international benchmark prices of X minus one. Therefore, any benefit arising from stability will come to consumers progressively,” he stated.
Using the current situation as an example, Wandayi said that if diplomatic agreements and market stability are achieved in June and maintained thereafter, the impact could begin reflecting in Kenya’s fuel prices around August.
His remarks come at a time when global energy markets are closely monitoring developments in the Middle East, with analysts warning that any renewed tensions could quickly reverse gains and trigger another surge in crude oil prices.
The Cabinet Secretary also revealed that current pump prices enjoyed by Kenyans are already being cushioned through government intervention, meaning any future reductions will be calculated from the actual market cost of fuel rather than the subsidised rates currently in place.
“The prices we are currently offering at the pump stations are a result of fuel subsidy. Any reduction will have to come from the actual price, not the subsidised prices,” he explained.
Wandayi’s comments follow the latest fuel price review by the Energy and Petroleum Regulatory Authority (EPRA), which announced reductions for the June–July pricing cycle.
Under the new rates, diesel prices dropped by KSh10 per litre to retail at KSh222.86, while petrol prices were reduced marginally by KSh0.22 to KSh214.03 per litre.
While the latest review offered some relief to consumers grappling with the high cost of living, Wandayi’s latest remarks suggest that any substantial price cuts linked to developments in the Middle East will take several weeks before they are reflected at Kenyan filling stations.
For now, motorists and businesses may have to wait until later in the year to determine whether global stability translates into meaningful savings at the pump.
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