BY PETER MURIMA
Unpredictable fuel prices created by the regulation practices of the Energy Regulatory Commission (ERC) are wanting and inappropriate. We fear the body is not serving national interest in its now-detested steady monthly upward increase of fuel prices.
We now have every reason to suspect that powerful public officials known to be involved in downstream marketing of petroleum products are to blame. They should be investigated for conflict of interest by the KACC.
The reason given for the recent hiking of pump prices flies off the wall, since the margin in global market prices is negligible, if calculated on the basis of US dollars per barrel. A barrel is obviously far larger than a litre – the former being equivalent to about 210 litres.
A barrel retails at around Sh8,000 making frequent fluctuations insignificant to warrant nagging intermittent pump adjustments. At present, global oil prices are equal to about Sh43 per litre.
The essence of fuel regulation is to make prices predictable which effectively stabilises markets by containing inflation caused by unreliable panicky markets.
We are aware that there has been a spirited lobbying by oil marketers over the controlling of hitherto profit appetites and it would be wrong for the Energy Ministry to succumb to the systematic pressure of a few merchants at the expense of national good.
The government should not let the ramifications of the dry season coupled with expensive fuel shoot up inflation because this will slow its much touted Vision 2030 goals besides impoverishing the motorists who are seemingly under siege from all fronts.
The Minister for Energy should never renege on earlier promises of making fuel prices a predictable mandate. Volatile and wobbly prices negate the work of the regulator.
If bigger economies in more stable countries guard their oil policies jealously why can\’t we?
In the event of destabilised bus fares and cost of goods the Energy Minister will be held responsible.
(Peter Murima is the Chairman, Motorist Association of Kenya)