BY ROBYN WANJIRA
Kenyans are once again being forced to dig deeper into their pockets as rising fuel prices push up the cost of living. For many households already struggling with high taxes, expensive food and stagnant incomes, the latest increase in transport fares has become yet another burden.
Just as the Russia-Ukraine war pushed pump prices beyond KES 200 per litre in 2022, the ongoing conflict involving the US, Israel and Iran is once again being felt thousands of kilometres away in Kenyan homes and businesses.
Matatu fares have already increased by about 25 per cent on some routes. A commuter travelling from Thika Road to Nairobi’s CBD, for example, could now pay KSh120 instead of KES 80. Online ride-hailing services have also adjusted fares upwards. While these increases may appear small on paper, they significantly stretch the budgets of millions of Kenyans who rely on daily public transport.
The latest Economic Survey 2026 by the Kenya National Bureau of Statistics (KNBS) shows just how central fuel is to the Kenyan economy. Kenya’s domestic demand for petroleum products rose by 9.9 per cent in 2025 to 5.7 million tonnes, while petroleum imports increased by 12.2 per cent to 5.5 million tonnes. This highlights the country’s continued dependence on imported fuel and its vulnerability to global shocks.
According to the survey, petroleum products remained Kenya’s single largest import bill at KSh511.5 billion in 2025. Any disruption in global oil markets therefore has an immediate impact on the local economy.
The roots of the current crisis lie far beyond Kenya’s borders. The conflict in the Middle East has threatened the stability of the Strait of Hormuz, one of the world’s most important oil shipping routes, which handles nearly 20 per cent of global oil and liquefied natural gas supplies. Fears of supply disruptions pushed global oil prices sharply higher, with ripple effects reaching countries like Kenya that rely heavily on imported petroleum.
Fuel is not a luxury for most Kenyans. It powers transport, manufacturing, electricity generation and food production. The Economic Survey shows that Kenya consumed 2.4 million tonnes of diesel and 1.7 million tonnes of super petrol in 2025 alone. Every increase in pump prices therefore filters through the entire economy.
One of the biggest consequences of rising fuel prices is the increase in food costs. Transporting food from farms and ports to markets becomes more expensive, and these additional costs are eventually passed on to consumers. Farmers are also grappling with higher production costs because agricultural machinery, irrigation systems and logistics all depend heavily on fuel.
This comes at a difficult time for households already struggling with food inflation. KNBS data shows that prices for vegetables, tubers, cooking bananas and pulses rose by 13.4 per cent in 2025, while fish and seafood prices increased by 16 per cent. Such increases are especially painful for low-income families, where food and transport consume the largest share of household income.
The pressure is even greater because real wages have continued to decline. The Economic Survey indicates that Kenya’s real wage index fell by 1.3 per cent between 2021 and 2025, meaning many workers are earning less in real terms despite rising prices. At the same time, the Consumer Price Index rose to 145.37 in 2025 from 139.69 in 2024, reflecting the steady rise in the cost of goods and services.
Small businesses and workers in the informal sector are among the hardest hit. The KNBS survey estimates that 83.8 per cent of Kenya’s workforce remains in informal employment. Unlike large corporations with financial buffers, many small traders, boda boda riders, kiosk owners and self-employed workers operate on very thin margins. Rising transport and logistics costs make it more expensive to run businesses, while customers struggling with their own budgets reduce spending on non-essential goods and services.
The result is a painful cycle in which businesses face higher operating costs even as demand weakens. It is yet another reminder of how quickly global geopolitical tensions can filter down to the smallest corners of Kenya’s economy.
The crisis also exposes Kenya’s structural weaknesses. Despite progress in renewable energy, the country remains heavily dependent on imported fuel. While Kenya generated more than 15,000 gigawatt hours of electricity in 2025, much of it from geothermal, hydro and wind energy, transport and logistics still rely overwhelmingly on petroleum products.
This is why Kenya must accelerate investments in renewable energy, electric mobility, local manufacturing and food production systems. Reducing reliance on imported fuel and imported agricultural inputs would help cushion the economy from future global shocks.
Until then, ordinary Kenyans will continue to bear the heaviest burden every time instability erupts in global energy markets.
