In a statement released on Thursday evening, EPRA said the subsidy will be financed through the Petroleum Development Levy (PDL) Fund as part of efforts to stabilize fuel prices amid soaring global oil costs.
“The Government will, in this cycle, cushion consumers through the Petroleum Development Levy Fund by utilizing approximately Ksh5 billion to subsidise the prices of diesel and kerosene,” EPRA stated.
Despite the intervention, motorists will still pay significantly more at the pump following the latest review for the period between May 15 and June 14, 2026.
Diesel prices rose sharply by Ksh46.29 per litre while super petrol increased by Ksh16.65 per litre. Kerosene prices remained largely protected due to the subsidy support.
The latest increases have pushed diesel prices to record highs, intensifying pressure on households, transport operators and businesses already grappling with a rising cost of living.
Analysts warn the higher fuel costs are likely to trigger increases in transport fares, food prices and the overall cost of goods and services across the country.
EPRA attributed the price surge to the rising landed cost of imported petroleum products caused by volatility in the international oil market.
Also Read
The regulator noted that global supply disruptions and high freight charges have continued to affect fuel importation costs.
The government’s move to inject billions into the subsidy program comes barely a month after the Treasury reduced Value Added Tax (VAT) on petroleum products from 16 percent to 13 percent, and later to 8 percent in an effort to cushion consumers from runaway fuel prices.
Energy experts say the continued reliance on subsidies signals growing concern within government over the economic and political impact of rising fuel costs.
Diesel remains critical to Kenya’s transport and manufacturing sectors, while kerosene is widely used by low-income households for cooking and lighting.
The latest EPRA announcement is expected to spark public debate over the sustainability of the subsidy program, especially as global crude oil prices remain unpredictable.
Economists have also warned that prolonged subsidies could strain public finances if international fuel prices continue climbing.
Meanwhile, transport operators in several towns have already hinted at increasing fares following the latest fuel review, raising fears of another wave of inflation in the coming weeks.
