Home Taxi transport Kenya’s worsening fuel crisis threatens to cripple economy – Xinhua

Kenya’s worsening fuel crisis threatens to cripple economy – Xinhua

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People line up to buy fuel at a gas station in Nakuru County, Kenya, April 4, 2022. (Xinhua/Sheikh Maina)

The fuel crisis has come at the worst time for Kenyans, as many grapple with rising inflation as prices of basics like cooking oil, bread and milk soar.

NAIROBI, April 4 (Xinhua) — Kenya has been hit hard by an unprecedented fuel shortage that threatens to cripple the country’s economy. The crisis has seen a number of oil marketing stations closed, dozens of travelers and motorists stranded, commodity prices soared across the country and public transport vehicles grounded.

Thousands of jobs and businesses are at stake as citizens feel the pinch of the shortage that has lasted for about a week.

Andrew Kamau, Principal Secretary of the Ministry of Petroleum and Mines, attributed the crisis to the government’s delay in paying 13 billion shillings (about $112.95 million) in subsidy funds to petroleum distributors. “This crisis is about money owed to oil companies by the government, which will be paid this week,” he told reporters in Kenya’s capital Nairobi on Sunday.

Kenya introduced a fuel subsidy scheme on April 14, 2021, which sees the government paying oil traders a certain percentage of fuel costs to protect the public and stabilize the market. The grant was awarded as part of efforts to reduce the high cost of basic items.

It has helped keep petrol, jet fuel and diesel prices stable over the past year, with a liter of petrol and diesel in the capital Nairobi rising by 4 US cents in March after four months of stability to stand at $1.17 and $1, respectively. While the actual rise in the price of gasoline, for example, was 17 cents in March, the government subsidy helped protect Kenyans.

Joseph Karanja, chairman of the Kenya Independent Petroleum Distributors Association (KIPEDA), said the delay in paying oil traders has seen many of them without money to buy new shares. “Our members have no oil to transport to different outlets across Kenya. We have visited many of them since last week and they had no fuel. The crisis is getting worse day by day. day,” he said in a recent interview.

An attendant refuels a vehicle along Thika Road in Nairobi, capital of Kenya, March 15, 2022. (Xinhua/Fred Mutune)

Even as the country is reeling from the fuel shortage, Macharia Irungu, managing director of Kenya Pipeline Corporation, however, said in a statement on Saturday that the East African nation has enough stocks.

Irungu said the government agency that sells fuel to traders had 69 million liters of super gas, 94 million liters of diesel, 13 million liters of kerosene and more than 23 million liters of jet fuel on Saturday. “Our global stock is sufficient to serve the region with more vessels queuing at Mombasa port for discharge,” he said.

The fuel crisis has come at the worst time for Kenyans, as many grapple with rising inflation as prices of basics like cooking oil, bread and milk soar.

Moses Kamau, a digital taxi driver, said on Monday the taxi sector was one of the hardest hit, as drivers have to hop from one gas station to another in search of the goods. And even when they find it at selected stations, they have to endure long queues, some of which stretch for miles, which eat away at their working time and they are only allowed to purchase specific liters.

In rural areas of Kenya, where the fuel shortage has lasted longer, citizens buy a liter of petrol for up to $1.7, 40 cents more than the official government price.

Motorists and motorbike taxi operators spend up to eight hours at service stations waiting for goods.

“On Sunday, I waited in vain at a gas station from 10 a.m. to 6 p.m. for fuel after the dealer promised me that a delivery vehicle was coming,” said Joseph Musumba, a primary school teacher, who operates a motorcycle taxi during school holidays. “I had to keep my bike at home because there is no fuel.”

His plight is shared by thousands of other people, many of whom crowd petrol stations with jerry cans in search of the goods after their bikes and vehicles run out of fuel.

With Kenya’s fuel-driven economy, the crisis portends bad times for citizens. The World Bank and the National Treasury predict that the country’s economy is expected to grow by at least 5%, boosted by the resumption of economic activities as the effects of COVID-19 fade locally and globally.