Kenya fuel prices: Diesel import costs surge as EPRA holds pump prices steady

Kenya's diesel market is experiencing a cost increase as imported diesel prices rose 11.86% in the latest review, while the Energy and Petroleum Regulatory Authority (EPRA) maintained pump prices steady for the next 30 days. Nairobi consumers will pay a maximum of Ksh214.03 per litre for petrol, Ksh217.86 for diesel, and Ksh191.38 for kerosene, while Mombasa diesel remains at Ksh214.58 per litre.

Despite the apparent stability at petrol stations, the underlying import costs have surged. EPRA reported that the average landed cost of diesel increased from US$855.59 per cubic metre in July to US$957.05 in August, while petrol's landed cost fell 7.87% to US$874.26 per cubic metre. Diesel is crucial for various sectors, making its cost fluctuations more impactful on the broader economy.

Although diesel consumption increased by 10.6% in the first half of 2026 compared to 2025, businesses face challenges in responding to higher prices due to its extensive use in commercial transport, logistics, agriculture, construction, and other heavy machinery activities. Regional price disparities exist, with prices varying significantly across different locations, adding to the cost burden for commercial vehicle operators.

Kenya's fuel-pricing mechanism incorporates landed costs, transportation, wholesale and retail margins, taxes, and other approved costs. The price-stabilisation mechanism absorbs surpluses, cushioning consumers during sharp international cost movements. However, this does not eliminate Kenya's exposure to the international market.

The latest KNBS inflation figures indicate a 6.6% annual inflation rate and a 15.7% year-on-year increase in the transport index, highlighting the economic implications of rising diesel import costs alongside increased consumption. The primary fuel-market risk for Kenyan businesses lies in the rising demand and international import costs, despite the current price freeze.