Motorists and Kenyans could be in line for lower fuel prices in the coming weeks after global crude oil prices fell sharply following a ceasefire agreement involving Iran, the United States and Israel, raising hopes of reduced fuel import costs.

🇰🇪 Breaking It Down

According to the latest Central Bank of Kenya (CBK) weekly bulletin, Murban crude oil prices fell by about Ksh1,319 per barrel, dropping to Ksh9,642 (USD74.41) from Ksh10,961 (USD84.60) a week earlier.

The drop of more than 12 per cent comes after geopolitical tensions in the Middle East eased, reducing fears of disruptions to global oil supplies that had pushed prices higher in recent weeks.

“Murban crude oil prices declined to USD 74.41 per barrel from USD 84.60 per barrel a week earlier, while spot gold prices increased marginally to USD 4,239.13 per ounce from USD 4,213.84 per ounce, reflecting increased foreign exchange market volatility,” read part of the CBK bulletin reviewed by Kenyans.co.ke

📌 What You Need to Know

CBK noted that commodity prices generally declined during the week , largely reflecting the easing of tensions after the United States and Iran signed a preliminary ceasefire agreement.

The development is significant for Kenya, which imports the bulk of its petroleum products and remains highly exposed to movements in global crude oil markets.

Any sustained decline in international oil prices could lower the cost of fuel imports and improve the chances of reduced pump prices in future reviews by the Energy and Petroleum Regulatory Authority (EPRA).

The latest price decline follows Iran's decision to reopen the Strait of Hormuz, one of the world's most strategic oil shipping routes through which about 20 per cent of global crude supplies pass.

The waterway had become a source of concern after escalating tensions between Iran, Israel and the United States raised fears of supply disruptions and possible spikes in global fuel prices.

For Kenya, the reopening of the route is particularly important because the country's government-to-government fuel supply programme relies heavily on petroleum products sourced from Gulf nations, including Saudi Arabia and the United Arab Emirates.

📰 Source: Kenyans.co.ke