The Cost of Your Car’s Full Tank of Fuel January-November 2023

The year 2023 has been a wild ride for fuel prices, with fluctuations that have left many car owners scratching their heads at the pump.

The year commenced with petrol priced at Ksh177.3 per litre, and by November, it reached Ksh217.36 in Nairobi. Diesel started at Ksh162.0 and closed the year at Ksh203.47. 

These increases underscored the challenges faced by car owners, compelling them to navigate a landscape of economic uncertainty and prompting a reevaluation of their budget and fuel consumption.

While fuel prices had been rising since early 2022, the current spike started when President Ruto removed fuel subsidies after he was sworn in September 2022. The move saw Petrol rise by 13%, diesel went up 18%, and kerosene increased by 16% from a month earlier.

Throughout, the government tried to lower the cost of fuel by introducing a momentary relief to stabilise pump prices. To cushion motorists from the spike in pump prices, EPRA opted for fuel stabilisation through the Petroleum Development Levy.

However, this proved ineffective, as the State doubled the value-added tax (VAT) on petroleum products from 8.0% to 16.0% when the Finance Act 2023 in July 2023. 

From January to November, the cost of filling up your car's tank has been anything but consistent. But how tumultuous was it? 

This article will explore the monthly changes in fuel prices and break down how these variations have impacted the wallets of two car owners: Juma and Onyango. 

Read Also: 5 Money Lessons Kenyans Have Learnt in 2023

A Tale of Two Car Owners

Juma is a 33-year-old Marketing Manager at an Ad Agency and drives a 2015 Subaru Legacy. With a monthly routine that involves driving to work, meeting friends and clients, and a once-per-month road trip to the city's outskirts for relaxation, Juma refills his 60-liter tank twice a month, consuming 120 liters of petrol. Though not the largest in capacity, his Subaru serves him well for his regular commuting needs.

On the other hand, we have Onyango, a 44-year-old practicing Surgeon and businessman also based in Nairobi. He is a busy man, and his diesel-powered 2018 Toyota Land Cruiser Prado helps him accomplish his routine.  

Onyango, who owns a pharmacy in Lavington, Nairobi, and a small hospital in Kitengela, has been overseeing the construction of his house over the past year. Onyango’s frequent travel demands are met by his Land Cruiser's 87-liter capacity, which refills full tank once a week. With four monthly refills, Onyango consumes 348 liters of diesel to keep up with his many professional and personal commitments.

With that in mind, let’s look at how their fuel budget fluctuated throughout 2023.

January: An Unchanging Beginning

Fuel prices in January held steady, mirroring the rates from the preceding pricing period of December-January. Car owners started the new year with an unchanged fuel budget. 

In January:

Juma spent Ksh21,276 (120 liters of petrol x 177.3 Ksh/L).

Onyango spent Ksh56,376 (348 liters of diesel x 162 Ksh/L). 

February: Holding Steady

In February, the anticipation of a drop in fuel prices left car owners waiting, but The Energy and Petroleum Regulatory Authority (EPRA) retained the prevailing fuel prices from February 15 to March 14, 2023.

Despite the hopes for change, both Juma and Onyango spent the same in February as they did in the last two months:

Juma: Ksh21,276 (120 liters x 177.3 Ksh/L)

Onyango: Ksh56,376 (348 liters x 162 Ksh/L) 

March - April: The Surge Begins

March marked the first rise in fuel prices for the year, with petrol increasing by Ksh2, while diesel remained unchanged. 

However, April maintained the same prices as March, with the EPRA boss noting, "the price of diesel has been cross-subsidized with that of Super Petrol."

During these months, Onyango's budget for fuel remained constant for the fifth consecutive month. On the other hand, Juma experienced a slight increase, with his fuel budget going up by Ksh240 for both March and April:

Juma: Ksh21,516 (120 liters x 179.3 Ksh/L)

Onyango: Ksh56,376 (348 liters x 162 Ksh/L)

May - June: The Price Rollercoaster

May brought an upward climb in fuel prices, with a liter of super petrol and diesel increasing by Ksh3.40 and Ksh6.40, respectively. This rise had a more pronounced impact on those driving diesel-powered cars, as seen in Onyango's fuel budget, which increased by Ksh2,215.

However, relief followed as prices dropped in the subsequent changes. The price of super petrol decreased by Sh0.66 to retail at Ksh182.04, while diesel saw a reduction of Ksh1.12, retailing at Ksh167.28 in Nairobi.

May Consumption:

Juma: Ksh21,924 (120 liters x 182.7 Ksh/L)

Onyango: Ksh58,591.2 (348 liters x 168.4 Ksh/L)

June Consumption:

Juma: Ksh21,844.8 (120 liters x 182.04 Ksh/L)

Onyango: Ksh58,224.64 (348 liters x 167.28 Ksh/L)

July - August: Soaring Costs

In July, fuel prices soared to unprecedented heights as The Energy and Petroleum Regulatory Authority (EPRA) adjusted pump prices upwards due to doubling the value-added tax (VAT) on petroleum products to 16%. 

This move saw petrol prices increase by Ksh13.49 per litre, and diesel by Ksh12.39. In Nairobi, a litre of super petrol reached Ksh195.53, while diesel surged to Sh179.67 — the highest since Kenya started capping pump prices, according to Business Daily. 

Starting July 1st, Juma's fuel budget increased by Ksh1,618, and Onyango's budget went up by Ksh4,289. The expenditure for July was:

Juma: Ksh23,463.6 (120 liters x 195.53 Ksh/L)

Onyango: Ksh62,513.16 (348 liters x 179.67 Ksh/L)

There was a slight relief in August as the petrol price decreased by Ksh0.85, although diesel remained unchanged. The expenditure for August was:

Juma: Ksh23,361.6 (120 liters x 194.68 Ksh/L)

Onyango: Ksh62,513.16 (348 liters x 179.67 Ksh/L)

September - October: Skyrocketing Costs

September witnessed a historic milestone as fuel prices in Kenya crossed the Ksh200 mark for the first time, with rates surging by as much as Ksh20 per litre for diesel. 

Super Petrol and Diesel prices were revised upward by Ksh16.96 and Ksh21.32 per litre, reaching retail prices of Ksh211.64 and Ksh200.9, respectively.

The fuel budget for both Juma and Onyango rose significantly in September:

Juma: Ksh25,396.8 (120 liters x 211.64 Ksh/L)

Onyango: Ksh69,955.52 (348 liters x 200.99 Ksh/L)  

Adding to the dynamics, EPRA announced in September that successful renegotiations of premiums with three Gulf oil companies had occurred, forming part of the government-to-government oil import deal. This news sparked optimism among car owners, with many anticipating a decrease in fuel prices in the subsequent month of October.

However, October saw fuel prices peak for 2023. Super Petrol increased by Ksh5.72, reaching Ksh217.36, and Diesel rose to Ksh205.47 from Ksh200.99.

These changes pushed the fuel budget of Juma past the Ksh26,000 mark for the first time, while Onyango's budget reached a new peak of Ksh71,452. 

October Expenditure:

Juma: Ksh26,083.2 (120 liters x 217.36 Ksh/L)

Onyango: Ksh71,452.56 (348 liters x 205.47 Ksh/L) 

November: Year-End Respite

November brought a sense of relief for motorists and Kenyans distressed by the continuous surge in fuel prices. 

Despite hopes for major drops, EPRA announced that the cost of super petrol would remain the same as in October. 

The regulator cautioned that without intervention that necessitated a Ksh12.01 compensation using the Petroleum Development Levy (PDL) to oil marketers, a litre of petrol could have risen to Ksh229.37.

However, diesel-powered car owners had a glimmer of hope as EPRA reduced fuel prices by Ksh2 from the highs of October. This move resulted in Onyango spending Ksh691 less to fuel his car in November.

Expenditure in November:

Juma: Ksh26,083.2 (120 liters x 217.36 Ksh/L)

Onyango: Ksh70,761.56 (348 liters x 203.47 Ksh/L)

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Read Also: How Rising Fuel Prices in Kenya Will Affect Your Wallet

WRAPPING UP 

As fuel prices keep increasing, reducing your consumption is the key to lowering your budget. You can do this by adopting fuel-efficient practices such as:

1. Regular engine maintenance and using high-quality motor oils. 
2. Keep your vehicle light by avoiding unnecessary luggage. 
3. Avoid unnecessary idling; for example, always turn off your engine when stationary.   
4. Maintain aerodynamics by keeping windows, sunroofs, and roof loads closed. Also, drive at moderate speeds to minimize wind resistance. 
5. Correctly inflate your tyres, as underinflating can lower your fuel economy.