By Benadeta Mwaura - Reporter
Kenya, June 15, 2026 -Kenyan motorists could begin to see gradual relief at the pump in the coming months following a sharp decline in global oil prices after reports of a peace agreement between the United States and Iran eased concerns over disruptions to global energy supplies.
However, Energy and Petroleum Cabinet Secretary Opiyo Wandayi has cautioned that any reduction in local fuel prices will not be immediate, citing Kenya's fuel import cycle and the country's pricing mechanism.
Speaking during a televised interview on Monday, Wandayi said the government expects international market gains to filter into the local market with a lag of about one month.
"International fuel shocks or gains are felt about a month later," he said. "We should only be a month behind."
Global oil markets reacted positively after Pakistan announced a breakthrough agreement between Washington and Tehran aimed at de-escalating months of conflict and reopening the Strait of Hormuz, a critical shipping route that carries nearly a fifth of the world's oil and liquefied natural gas supplies.
Following the announcement, Brent crude, the global benchmark used to price Kenya's fuel imports, fell by nearly five percent to about $83.18 per barrel, while U.S. benchmark West Texas Intermediate (WTI) dropped by more than five percent in Asian trading.
The easing of geopolitical tensions has raised expectations of improved oil supply flows and lower shipping costs, although analysts caution that supply chains may take several weeks to normalise as tanker backlogs clear and maritime security risks subside.
For Kenya, which imports all its petroleum products, movements in global oil prices directly influence local pump prices alongside freight charges and exchange rate fluctuations.
Wandayi said Kenya currently imports approximately 600 million litres of petroleum products every month, including petrol, diesel and jet fuel, meaning local prices reflect the cost of cargoes purchased weeks earlier rather than real-time market movements.
The Cabinet Secretary noted that the government's objective remains to gradually reduce reliance on fuel subsidies as international prices stabilise.
"The desirable outcome for government is to minimise the application of the fuel subsidy," he said.
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According to Wandayi, the subsidy programme is financed through levies collected at the pump, making it difficult to sustain during periods of prolonged high oil prices.
The latest global developments come just days after the Energy and Petroleum Regulatory Authority (EPRA) announced lower pump prices for the June-July pricing cycle.
Under the new review, the price of Super Petrol in Nairobi fell marginally by KSh0.22 to KSh214.03 per litre, while Diesel dropped by KSh10.00 to KSh222.86 per litre. Kerosene remained unchanged at KSh191.38 per litre.
EPRA attributed the changes to movements in global oil prices, landed import costs and exchange rate adjustments.
To cushion consumers from higher energy costs, the government is expected to utilise approximately KSh10.3 billion from the Petroleum Development Levy Fund to stabilise diesel and kerosene prices during the current review period.
While the recent decline in global oil prices offers hope for further reductions in Kenya's next pricing cycle, analysts say the extent of the relief will depend on whether the U.S.-Iran agreement holds and whether the downward trend in crude prices is sustained over the coming weeks.
Any prolonged period of lower oil prices would not only ease pressure on household budgets but could also help contain inflation by reducing transport, manufacturing and food distribution costs across the economy.