Fuel stabilisation fund kity receives Ksh.6.7 billion

Fuel stabilisation fund kity receives Ksh.6.7 billion

Members of Parliament have allocated Ksh.6.7 billion which will be channeled to the Petroleum ministry for fuel subsidy to cushion consumers from the shocks of rising petroleum prices under the Petroleum Development Levy Fund (PDL).

“Increase Ksh.6.7 billion (recurrent) for fuel stabilization,” the budget committee of the National Assembly recommended in a report to the full House.

In February, MPs had proposed a Ksh.25 billion fuel stabilisation fund upon Russia’s invasion of Ukraine, a move that has since set the price of commodity soar on a record high.

“We are very aware of the situation with oil prices globally which will impact local prices. We have proposed an allocation of Sh25 billion to the fuel subsidy in our report to the Budget and Appropriations Committee,” Bonchari MP Pavel Oimeke, who is a member of the Energy Committee, told Nation newspaper yesterday.

“The war in Ukraine will significantly increase fuel prices and if you let Kenyans shoulder that increase then it will burden them heavily,” said the MP.

The surge in fuel costs has seen stakeholders in the transport sector announce a hike in services offered, the recent one being Kenya Transport Association which encouraged all Public Service Vehicles in the country to increase their services by at most 5 percent.

“KTA wishes to advise transporters countrywide to increase their transport rates by a minimum of 5% to sustain their businesses under the current circumstances and to circumvent a total collapse of their businesses,” said Newton Wangoo, KTA Chairman.

According to KTA, fuel costs contribute up to 35 percent of total direct transport costs and indirectly affects other costs including tyres and spare parts since they are all imported.

Energy and Petroleum Regulatory Authority (EPRA) in its last review chose to top up Ksh.5 on the previous pump price, increasing a litre of petrol to Ksh.134.72.

Motorists using Diesel are currently paying Ksh.5 more to Ksh.115.60 per litre. This even as Kerosene users have been spared from the price hike.

The recent allocation for fuel subsidy is meant to cushion Kenyans from the high fuel costs for a long time despite price of Brent crude oil having shot high recently to Ksh.14,131.

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