Kenya’s oil marketing companies asked the government to help them hedge against falling prices ahead of the regulator’s monthly review of retail rates.

In the price-review scheduled for Thursday, authorities should exclude April-priced cargo that wasn’t sold as the coronavirus crushed demand, the retailers said in a letter to the petroleum cabinet secretary. The government should give “the much-needed grace period to sell the expensive inventory,” they said.

The Energy and Petroleum Regulatory Authority Director-General Pavel Oimeke criticized the proposal. It would “contravene the law,” Oimeke said by phone.

Demand for gasoline and diesel declined 40% in April after Kenya restricted movement as part of measures to curb the virus outbreak, according to the marketers. The East African nation has confirmed 715 Covid-19 cases and 36 deaths.

 

Source: Bloomberg

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