Kenyans face even higher fuel prices in ’26
By Rawlings Otieno, August 1, 2025Kenyans should prepare for higher fuel prices in July next year as the Energy Petroleum Regulatory Authority (EPRA) implements the final phase of the Cost of Service for the Supply of Petroleum Products (COSSOP).
COSSOP, introduced in 2018 to cushion oil marketing companies (OMCs) through phased profit margin increases, has driven costs from Sh4 in 2018 to Sh17 in 2025.
The Senate Energy Committee, chaired by Oburu Odinga, questioned Energy Cabinet Secretary Opiyo Wandayi about rising fuel prices despite declining global costs. Currently, petrol costs Sh186.31 per litre in Nairobi compared with Sh161.80 in landlocked Rwanda.
Senate Minority Whip Ledama Olekina (Narok) criticised EPRA’s approach: “In 2017, the margins for the OMCs was at Sh4, which was being split between the OMCs and the retailers. By 2024-25, the margins are now being split between Sh11 and Sh6 respectively. EPRA is increasing the margins of OMCs… Please consider the life of Kenyans.”
Increases defended
EPRA’s Petroleum Director Edward Kinyua defended the increases, explaining that a 2023 COSSOP study justified higher margins, while the Roads Maintenance Levy increased from Sh18 to Sh25.
“You cannot implement the increase in one phase, otherwise the price of fuel would have been out of reach for many households. We have already done the worst. The next increase will be negligible,” Kinyua said.
Senator Veronica Maina questioned Kenya’s regional competitiveness: “Has the [government-to-government fuel purchase deal] rendered some reliefs to Kenyans. Why is our price the highest in the region?”
Wandayi attributed recent Sh9 per litre increases to landed costs, storage, distribution, margins, and taxes. Current levies include excise duty (Sh21.95), road maintenance levy (Sh25), VAT (Sh25.70), and other fees totalling over Sh80 per litre.
The government spent Sh13.6 billion in 2024/25 to stabilise petroleum prices using the petroleum development levy. “When prices have not spiked, we don’t apply the levy,” Wandayi explained.
Oburu questioned the timeline: “How did the margins between August 2024-July 2025 increase from Sh12.30 to Sh17? You are now in a hurry to recover what they lost?”