Kennedy Senelwa
23 April 2008
Nairobi — Petrol prices have hit the Sh100 per litre mark in Nairobi, with crude oil trading at US $117 a barrel due to international supply fears and price uncertainties.
Kobil, Kenol and Total petrol stations have adjusted prices by an average of Sh2 per litre, taking the retail cost of petrol to an all time high of Sh99.49 in Nairobi's Central Business District. Diesel was going at Sh90.49.
The British Broadcasting Corporation (BBC) yesterday said crude oil prices crossed the US$117 a barrel mark due to supply fears after a militant group in Nigeria announced it had attacked a Shell-operated pipeline.
And Kobil, Kenol and Total said that in addition to that, a weaker dollar and geopolitical factors were to blame.
Profit margins
Officials of oil firms who sought anonymity said that by absorbing a big proportion of crude oil price escalation instead of passing it on to consumers, their profit margins had been affected adversely.
A spot check by the Nation revealed that Kobil petrol station on Koinange Street had the highest prices, with petrol going at Sh99.49 and diesel Sh90.49.
Kenol's outlet on the same street sold petrol at Sh99.09 and diesel at Sh80.39, whereas the Total station, also on Koinange, dispensed petrol at Sh99.19 and diesel at Sh90.19 per litre.
The Shell station on Kenyatta Avenue had not effected any changes as petrol was still being sold at Sh96.77 per litre, while diesel was going at Sh87.99.
Caltex on Kimathi Street had not adjusted prices upwards as petrol was going for Sh96.99 and diesel at Sh87.99.
Prices outside Nairobi's CBD varied depending on the location of the petrol stations.
Bound to rise
Kenya Shell's Managing Director, Mr Patrick Obath, had warned last month that retail pump prices were bound to rise as a result of the escalating cost of crude oil in the international market.
And yesterday, Petroleum Institute of East Africa (PIEA) general manager George Wachira said that the rise in global crude oil prices had been caused by the weakness of the US dollar, speculative activities and geopolitics.
Britain's national broadcaster, BBC had said that an attack on a pipeline connected to the Bonny exports terminal in Nigeria raised prices as militants in the Niger Delta have from 2006 disabled the country's normal crude oil output .
Shell reported only small output losses, but the event follows a spate of kidnappings and sabotages in the Niger Delta region.
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