Independent fuel dealers threaten shutdown over wholesale price dispute

Independent petroleum dealers across Kenya have threatened to suspend operations over alleged breaches of regulated wholesale fuel prices by oil marketing companies (OMCs), raising concerns over potential shortages at petrol stations nationwide.

In a joint statement issued on Tuesday, the Petroleum Outlets Association of Kenya (POAK) and the Kenya Independent Petroleum Dealers Association (KIPEDA) accused OMCs of selling petroleum products to independent dealers above the maximum wholesale prices gazetted by the Energy and Petroleum Regulatory Authority (EPRA).

The associations said the dispute began on October 15, a day after EPRA announced the maximum retail and wholesale prices for the October-November pricing cycle.

Under the gazetted rates, Nairobi’s maximum wholesale prices were set at Sh211.80 per litre for super petrol, Sh212.60 for diesel and Sh204.79 for kerosene.

The corresponding maximum retail prices were set at Sh226.96 for petrol, Sh227.27 for diesel and Sh219.87 for kerosene.

However, the dealers alleged that OMCs began charging independent outlets above the prescribed wholesale limits when the new prices took effect.

“Despite immediate escalations by POAK and KIPEDA to EPRA and the Ministry of Energy and Petroleum, 12 days have elapsed without compliance or enforcement,” the associations said.

They warned that the alleged violations had squeezed dealers’ profit margins, making it increasingly difficult for independent operators to purchase fuel legally and remain commercially viable.

The associations attributed emerging stock-outs at independent petrol stations to the dispute, warning that continued non-compliance could force operators to suspend business or incur substantial losses.

They also cautioned that the situation threatened consumer protections under the regulated pricing framework, which sets maximum prices for petroleum products.

In response, POAK and KIPEDA advised independent dealers nationwide to immediately suspend purchases of petroleum products offered at wholesale prices above the gazetted EPRA limits.

The associations further demanded urgent enforcement action by EPRA and the State Department for Petroleum, including regulatory sanctions against oil marketers found to have violated the prescribed prices.

They warned that failure by the government to intervene could trigger a wider shutdown of independent retail outlets, disrupting fuel distribution and access to petroleum products across the country.

The dealers said they remained willing to engage with the Ministry of Energy and Petroleum and EPRA to resolve the dispute and restore compliance in the market.

EPRA and the Ministry of Energy and Petroleum had not responded to the allegations by the time of publication.