Billions Spent as Government Moves to Shield Kenyans From Soaring Fuel Prices
The government has deployed approximately Sh5 billion from the Petroleum Development Levy (PDL) Fund to cushion Kenyans from the latest rise in fuel prices in the review period running from May 15 to June 14, 2026.
The intervention comes as global oil prices continue to climb due to supply disruptions, rising freight charges and escalating geopolitical tensions in the Middle East, factors that have significantly pushed up the cost of imported petroleum products.
Despite the subsidy support, motorists across the country will still pay more at the pump following the latest review announced by the Ministry of Energy and Petroleum. Super Petrol has increased by Sh16.65 per litre, while diesel has registered a sharp increase of Sh46.29 per litre. Kerosene prices, however, remain unchanged after government intervention.
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Energy and Petroleum Cabinet Secretary Opiyo Wandayi said the government had activated the stabilisation mechanism to protect consumers and critical sectors of the economy from the full impact of soaring global fuel prices.
“To mitigate the impact of rising global petroleum prices on consumers and the wider economy, the government has utilised the Petroleum Development Levy stabilisation mechanism to cushion the prices of Diesel and Kerosene during this review period,” Wandayi said.
He added that the Sh5 billion support package was aimed at moderating the extent of the price increase while ensuring stability within the petroleum supply chain.
Why Are Fuel Prices Rising in Kenya?
According to the Ministry, Kenya remains vulnerable to fluctuations in international oil markets because it relies heavily on imported refined petroleum products.
Data released during the latest pricing review showed that the average landed cost of imported Super Petrol rose from USD 823.27 per cubic metre in March 2026 to USD 906.23 per cubic metre in April 2026, representing a 10 per cent increase.
Diesel recorded the highest jump during the same period, rising by 20.32 per cent, while kerosene posted a marginal increase of 1.59 per cent.
The Ministry attributed the sharp rise in fuel prices to a combination of global supply disruptions, increased marine insurance premiums and higher freight costs linked to instability around the Strait of Hormuz.
Officials warned that global spot freight and insurance charges have more than doubled in recent months, placing additional pressure on fuel-importing countries such as Kenya.
How Is the Government Cushioning Consumers?
The government says several policy measures have been introduced to protect consumers from even higher fuel costs.
Among the key interventions is the continued use of the Petroleum Development Levy Fund to stabilise diesel and kerosene prices. The Ministry also cited the reduction of Value Added Tax on petroleum products from 16 per cent to 8 per cent as another major relief measure.
In addition, officials defended the Government-to-Government fuel importation framework, saying it has helped Kenya avoid excessive global cargo premiums and freight costs.
“The Government-to-Government fuel importation framework has continued to shield the country in a great way from escalated petroleum cargo freight and premiums globally,” the Ministry stated.
The government further assured Kenyans that the country currently has sufficient petroleum stocks and that fuel supply remains stable despite the latest price adjustments.
At the same time, the Ministry urged fuel dealers and other players in the energy sector to avoid exploiting consumers during the current market uncertainty.
“We should all remain vigilant against possible profit-driven exploitative practices during this period of uncertainty, ensuring that consumers are not placed at any further disadvantage,” the statement read.
The latest fuel review is expected to increase pressure on households, transport operators and manufacturers already struggling with the high cost of living. However, the government says it will continue engaging stakeholders in the transport, energy and manufacturing sectors to manage the impact of rising fuel prices while protecting affordability for ordinary Kenyans.
