Oil & Gas

Kenya could be among the indirect beneficiaries of geopolitical upheaval in Venezuela, where the arrest of President Nicolás Maduro and the ensuing U.S. intervention have rattled global energy markets. The dramatic shift has contributed to a sharp fall in international oil prices, with Brent crude dipping below $60 a barrel amid expectations of increased supply and market oversupply. This decline offers a rare opportunity for relief at the pump for Kenyan motorists and businesses grappling with high living costs.

Because Kenya imports all its petroleum products in refined form, international oil price movements directly affect local fuel costs. Lower global crude prices and landed costs typically translate into a reduced import bill, which helps regulators like the Energy and Petroleum Regulatory Authority (EPRA) adjust maximum fuel prices downward. However, fuel price changes in Kenya are not instantaneous; EPRA sets prices based on the previous month’s average global costs and exchange rates, meaning any relief at the pump may still take time to materialize.

Kenya’s current fuel pricing cycle still reflects higher costs from earlier months, with Super Petrol and Diesel retailing at levels set before the latest global price dip. The earliest opportunity for downward adjustment will be in the February fuel price review, when EPRA can factor in the recent decline in international oil prices and landed costs. This lag highlights how global market shifts influence local pricing with a delay.

Beyond petrol station prices, cheaper oil imports can also help Kenya’s broader economy. A lower fuel import bill reduces demand for dollars, easing pressure on the Kenyan shilling and strengthening foreign exchange reserves, which supports macroeconomic stability. Reduced energy costs can then ripple through transport, agricultural production, and logistics sectors, potentially helping to tame inflation and consumer price pressures.