The Energy and Petroleum Regulatory Authority has announced a reduction of fuel prices in the latest review.
In the review, the price of super petrol has been reduced to Sh5 per litre, while diesel and kerosene have been cut by Sh5 and Sh4.82 respectively.
In Nairobi, super petrol, diesel and kerosene will now retail at Sh207.36, 196.47 and Sh194.23 effective midnight for the next 30 days.
"In accordance with Section 101(y) of the Petroleum Act 2019 and Legal Notice No.192 of 2022, Epra has calculated the maximum retail prices of petroleum products, which will be in force from January 15 to February 14, 2024," Epra said in a statement.
"In the period under review, the maximum allowed petroleum pump price for super petrol, diesel and kerosene decrease by Sh5, Sh5 and Sh4.82 per litre respectively."
The regulator said the new prices are inclusive of the 16 per cent Value Added Tax (VAT) in line with the provisions of the Finance Act 2023.
The drop in fuel prices for the second month in a row could be due to a drop in global crude prices.
Crude oil futures lost more than 10 per cent in 2023 in a volatile year of trading and reported their biggest annual drop since 2020, a trend that has extended into 2024, with prices closing the first trading session of 2024 at 76.87 per barrel.
This, as expectations for fed rate cuts continue and on easing concerns that tension in the Red Sea, which saw global shipping line re-route vessels to longer voyages, will disrupt supplies.
Epra in December announced a Sh5 drop in the pump price of a litre of super petrol, Sh2 on diesel and Sh4.01 on a litre of kerosene, even as it quoted crude prices at a much higher price of $93.92 for November imports, compared to the then average price of $76 per barrel, denying consumers full benefits.
The disruption in the Red Sea started last month after attacks by Iran-backed Houthi rebels in Yemen, on ships travelling to Israel.
This saw shipping lines divert their vessels away from the Red Sea avoiding the Suez Canal which is a key route for voyages to Mombasa and the East African coastline, but he move is yet to impact on supplies and costs.
Israel's war on Gaza was also feared could affect global fuel supplies but the impact is yet to be felt and instead, oil-producing countries have been cutting output to try and stabilise prices which have been going down.
In December, the price of OPEC basket of thirteen crudes averaged $78 a barrel with the highest being $81.82, according to OPEC Secretariat calculations.
Analysts at Goldman Sachs expect brent to range between $70 and $90 a barrel in 2024 based on flexible OPEC+ supply, a low risk of recession and opportunistic strategic petroleum reserve purchases by China and the US.