Kenya Spends KSh 6.2 Billion to Prevent Diesel Prices from Soaring to KSh 230 Per Litre
Nairobi, 15 April 2026
The Kenyan government has deployed KSh 6.2 billion in fuel subsidies to prevent diesel prices from reaching a staggering KSh 236.89 per litre, according to EPRA officials. Without this intervention, motorists would have faced increases exceeding 60 shillings per litre.
Government Intervention Prevents Catastrophic Price Surge
Building on the fuel price crisis previously reported, new details have emerged about the extent of government intervention in Kenya’s fuel market. Tim Kipchumba, an EPRA official, revealed that without the KSh 6.2 billion subsidy programme, diesel prices would have soared to KSh 236.89 per litre, with petrol reaching KSh 217.27 and kerosene hitting KSh 267.81 [1]. This represents a potential diesel increase of over 60 shillings per litre beyond current pricing levels [1]. The government’s Petroleum Development Levy (PDL) Fund has been specifically deployed to stabilise pump prices and cushion consumers from these dramatic increases [2].
Economic Ripple Effects Across Transport Sector
The fuel price adjustments announced on Tuesday, 14 April 2026, have already triggered immediate responses across Kenya’s transport sector [2][3]. Matatu operators have announced fare increases following EPRA’s decision to raise fuel prices past KSh 200 per litre [4]. The current pricing structure shows petrol at KSh 206.97 per litre and diesel at KSh 206.84 per litre in Nairobi, whilst the highest prices are expected in Mandera, where petrol will cost KSh 229.15 per litre [3]. These increases directly affect the cost of transporting essential goods to refugee settlements in northern Kenya, including food deliveries and humanitarian aid shipments to Kakuma and Kalobeyei.
Global Market Pressures Drive Local Impact
The dramatic price pressures stem from unprecedented increases in global commodity costs during March 2026. Import costs for super petrol rose by 41.532% from US$582.11 per cubic metre in February 2026 to US$823.87 in March 2026 [2]. Diesel import costs surged even more dramatically, increasing by 68.72% from US$636.45 to US$1,073.82 per cubic metre over the same period [2]. Kerosene experienced the steepest rise, climbing 105.156% from US$639.48 to US$1,311.93 per cubic metre [2]. Kipchumba attributed these increases to Brent crude oil prices rising from between $60-70 per barrel earlier in 2026 to over $100 in March and April, with some prices reaching $120 [1].
Tax Relief Measures Provide Additional Consumer Protection
Alongside the substantial subsidy deployment, the government has implemented VAT reductions on fuel from 16% to 13% as an additional consumer protection measure [2][3]. This tax adjustment, combined with the KSh 6.2 billion from the Fuel Stabilisation Fund, demonstrates the government’s comprehensive approach to managing the crisis [1][2]. Energy Minister Opiyo Wandayi has warned that Middle East conflicts continue to disrupt global supply chains, though he assured the public that Kenya maintains sufficient fuel reserves and cautioned oil marketing companies against hoarding practices [2]. The new pricing structure will remain in effect from 15 April 2026 to 14 May 2026, with EPRA monitoring global market conditions for future adjustments [2].