EPRA

EPRA’s November 2023 report cited an average cost of $93.92 per barrel; however, actual trading values on December 7, 2023, reported by multiple sources, reveal a significant drop to $76 per barrel. 

This substantial variance in reported and observed prices has not only brought into question the accuracy of EPRA’s data but also raised broader concerns about transparency in the Murban crude oil pricing mechanism. 

The discrepancy carries potential implications for the economic landscape, as it can impact various sectors, including the cost of refined petroleum products. Furthermore, such inconsistencies may lead to uncertainties for businesses and investors, affecting overall market confidence.

The energy and petroleum regulatory authority (epra) plays a pivotal role in regulating and pricing petroleum products in Kenya, serving as the primary authority responsible for overseeing the energy sector.

EPRA’s multifaceted role encompasses several key functions aimed at maintaining fair practices, ensuring consumer protection, and contributing to the overall stability of the energy market.

One crucial aspect of epra’s role is the establishment of price caps. On the 14th of every month, epra kenya sets maximum pump prices for various cities and towns across Kenya. This practice provides a regulatory framework to prevent unjustified price hikes.

Additionally, epra takes an active role in regularly reviewing and announcing new fuel prices. This monthly assessment, also conducted on the 14th, allows epra to respond to market dynamics, ensuring that fuel prices align with prevailing economic conditions.

The mispricing of crude oil poses significant economic ramifications, impacting businesses, consumers, and the overall economy. Inaccurate pricing can lead to increased operational costs for industries reliant on oil, potentially affecting profit margins and investment decisions. 

Consumers face the brunt through higher living costs, inflationary pressures, and potential reductions in spending. The overall economy may experience trade imbalances, financial market volatility, and shifts in employment levels, especially in oil-dependent sectors. Governments may grapple with revenue fluctuations, necessitating adjustments to budgets and tax policies.

As of the latest assessments, the global Murban crude oil market is undergoing shifts influenced by various factors. The International Energy Agency (IEA) anticipates an increase in global crude oil runs, forecasting an average of 83.6 million barrels per day (mb/d) in 2024. 

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This uptrend aligns with expectations from the Energy Information Administration (EIA), projecting an increment in Brent prices from an average of $78 per barrel in December 2023 to an average of $83 per barrel throughout 2024.

Contrastingly, the International Monetary Fund (IMF) offers a different perspective, indicating that futures markets suggest a decline in crude oil prices in the coming years, potentially reaching $72.7 per barrel in 2026. 

Against this backdrop, it’s crucial to compare EPRA’s pricing of Murban crude with actual market rates. The provided data on epra fuel prices today in Kenya reveals the current scenario. 

For super petrol, prices stand at Ksh 212.36 per liter in Nairobi, Ksh 209.3 in Mombasa, Ksh 212.12 in Eldoret, and Ksh 211.35 in Nakuru. Diesel prices are recorded at Ksh 201.47 per liter in Nairobi, Ksh 198.41 in Mombasa, Ksh 201.65 in Eldoret, and Ksh 200.88 in Nakuru. Kerosene prices are at Ksh 199.05 per liter in Nairobi, Ksh 195.92 in Mombasa, Ksh 199.23 in Eldoret, and Ksh 198.46 in Nakuru.

These figures result from a decrease in the average landed cost of imported super petrol by 16.11% from October 2023 to November 2023. Diesel and kerosene also experienced decreases, with declines of 5.43% and 6.63%, respectively.

 

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