BusinessPeople Daily

PS warns fuel dealers of economic crime charges

James Momanyi @jamomanyi

Petroleum principal secretary Andrew Kamau has warned petroleum products dealers and transporters, who have grounded their trucks in protest against the 16 per cent fuel tax of dire consequences because their actions are tantamount to economic sabotage.

Yesterday, the country started experiencing fuel shortage in a number of places. Kenyans took to social media to complain about the shortage and posted information and pictures of closed petrol stations in Nairobi and other towns.

But the PS said that those transporters who have barricaded the road to Konza Depot and other parts of the counrty were engaging in a crime.

The dealers started their strike on Monday in a move that led to oil shortages in parts of the country after a16 per cent VAT levy on petroleum products came into effect on September 1, 2018.

“We are aware there has been a reported shortage of fuel in some parts of the country. Independent transporters and dealers are claiming their decisions are to oppose the new VAT regime,” he said.

The State yesterday sent a contingent of General Service Unit and Adminstration police to Kenya Pipeline Lunga Lunga depot, Nairobi, after the dealers became rowdy.

Earlier in Parliament, Energy Regulation Commission (ERC) director general Pavel Oimeke who appeared before the senate Committee on Energy together with Energy PS Joseph Njoroge told Senators that the government will cancel the licences of fuel transporters who are currently on strike.

“As a commission we will take action against the transporters who are on strike. If the strike persists, we will cancel their licences,” he warned.

The MD also ruled out fears that the price of fuel will go up further following what he reffered to as “incorrect computation” of the 16 per cent VAT petroleum products.

He said that the current maximum retail pump price on petroleum products is accurate and there will be no further review until mid-month when changes are made.

“We do not expect any changes on the power bills because the energy which was being generated from the heavy fuel oils already have VAT in it. So Kenyans will not see a further increase in power bills because the VAT on fuels had already been factored,” said Oimeke.

The MD also tried to allay fears that the cost of fuel will increase in the coming months due to increase in price of crude oil in the international market.

“Over the past few months from May, there has been a marginal reduction in the price of crude oil. We had been paying around $78 (Sh7,858.5) a barrel but we are now paying around $74 (Sh7,455.5) now,” he said.

During the meeting Njoroge who represented the Energy Cabinet secretary also said that the power bills are expected to come down when the Lake Turkana Wind power plant is commissioned in the next few days.

The plant which is expected to add 310 megawatts to the national grid will replace costly thermal energy and allow Kenya Power to review the fuel levy on power bills.

Show More

Related Articles