Small relief as oil prices fall

Fuel prices in Kenya have began easing as international oil prices dropped below the $100 per barrel mark.

From a high of Shs110 a month ago, the price of a litre of petrol now averages Shs105. The government wants oil companies to reduce fuel prices further. The oil companies say their margins are already suffering from increased transport costs, higher insurance premiums and harsh taxation measures introduced by the Kenya Revenue Authority (KRA).

In the international market, oil prices have fallen further amid concerns that a slowdown in the global economy will dent demand.

US light, sweet crude fell $4.56 to settle at $91.15 a barrel in New York while Brent crude was down to $89.22 in London.

The oil price has fallen from highs of above $147 a barrel in July.

More on this story from the BBC >>

One Response

  1. Interesting article. One of the things I have been concerned with is the strain that oil will put on the economic ”recovery.” Even though these one off situations like Egypt, Saudi Arabia, and Japan will have a short-term effect, the long-term trend is what I am most concerned about. What is interesting is that in several areas that have been hit hardest the following circumstances are all happening at once.

    In most of these areas (Phoenix, Las Vegas, Inland Empire) , housing prices have crashed, leading to underwater houses and eventually foreclosures. Unemployment has skyrocketed in these areas as well. Now that prices have fallen so far and inventory appears to some to be ripe for the picking, investors are purchasing properties for to rent for cash flow. However, as oil picks up, it is becoming clear that many of these desert communities are not sustainable as they rely on cheap oil as many of the cheapest surrounding areas are commuter communities. The uncertainty is tremendous in these markets, yet many investors are jumping in and gobbling up properties.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: