Kenyans should prepare for another increase in fuel prices from July next year as the Energy and Petroleum Regulatory Authority (EPRA) implements the final phase of a plan that has gradually raised profit margins for oil marketers since 2018.

The plan, known as the Cost of Service for the Supply of Petroleum Products (COSSOP), was introduced to ensure that Oil Marketing Companies (OMCs) earn regulated profit margins on fuel sales, distributed between importers and retailers.

Over the years, these margins have grown from Sh4 per litre in 2018 to a record Sh17 per litre in 2025.

The issue came into focus when the Senate Energy Committee summoned Energy Cabinet Secretary Opiyo Wandayi to explain why domestic fuel prices have remained high despite a drop in global oil prices.

The committee, chaired by Siaya Senator Oburu Odinga, raised concerns about the affordability of fuel and the fairness of the pricing model.

In a comparison that highlighted the problem, senators noted that a litre of petrol in Nairobi costs Sh186.31, while in Kigali, Rwanda—despite being landlocked and importing its fuel through Dar es Salaam, the price stands at Sh161.80 per litre.

Narok Senator and Senate Minority Whip Ledama Olekina strongly criticised EPRA’s pricing model, saying the authority was favouring oil marketers over the needs of ordinary Kenyans.

“In 2017, the profit margin stood at Sh4, shared between OMCs and retailers. By 2024–25, the margin is now Sh17, split Sh11 and Sh6 respectively. EPRA is increasing OMCs’ margins unjustifiably. You can’t say operational costs have risen this drastically. Please consider the lives of Kenyans," Ledama said.

EPRA’s director of Petroleum and Gas, Eng Edward Kinyua, defended the margin increases, citing the 2023 review of COSSOP as the basis for the adjustments.

He also pointed out that the Road Maintenance Levy, which rose from Sh18 to Sh25 last year, contributed to the rise in pump prices.

“Implementing the full increase in one go would have made fuel unaffordable. We phased it in gradually. The worst is behind us. The next increase will be negligible,” Kinyua said.

But the explanation did little to ease the concerns of lawmakers.

Senator Ledama also questioned why the taxes on landed fuel were as high as 101 per cent, especially given the relatively stable exchange rate of Sh129–Sh131 to the dollar since August 2024.

As the implementation of the final COSSOP phase nears, Kenyans now face the prospect of even higher fuel prices, with many questioning whether the current pricing structure truly serves public interest.