Kenya's transport inflation hits 17.1% in October, highest since 2018

Transport inflation in Kenya rose to 17.1% in October from 15.6% in September, the highest since September 2018, after the government withdrew fuel subsidies in October, Business Daily reported on 10 November 2026, citing Kenya National Bureau of Statistics (KNBS) data.

Kerosene rose fastest year on year. Diesel averaged KSh228.77 a litre in October, up 32.5% from KSh172.64 a year earlier, and super petrol averaged KSh227.85, up 22.8% from KSh185.59. Kerosene was KSh220.88, up 41.6% from KSh155.96.

Business Daily reported that the government had exhausted the Petroleum Development Levy Fund, which paid for the subsidy, after months of spending to hold down pump prices following the Middle East conflict that began in February. Energy and Petroleum Regulatory Authority (EPRA) Director-General Edward Kinyua said on 14 October that the subsidy was withdrawn to save money for future supply disruptions and for higher demand for diesel and kerosene during Europe's winter. Treasury Cabinet Secretary John Mbadi said on 3 November, in an interview with Ramogi FM, that the government had expected fuel prices to rise in November as Europe entered winter, so it had deliberately not used money from the fuel stabilisation fund in the October review and had kept it to cut prices in the November review.

At its peak Kenya paid a record subsidy of KSh34.07 a litre on diesel. An International Monetary Fund analysis found Kenya passed on up to 62% of international fuel price changes to consumers between February and September.

KNBS data carried by Kenyans.co.ke on 30 October show petrol rising from KSh214.95 a litre in September to KSh227.85 in October, diesel from KSh219.04 to KSh228.77, and kerosene from KSh192.56 to KSh220.88, a rise of 14.7%.

KNBS data show public transport operators raised fares on several routes by 25% to 30% year on year, and the fare for a matatu (minibus taxi) ride from Westlands to Kangemi in Nairobi rose from KSh40 to KSh50. A boda boda (motorcycle taxi) trip from Siaya town to Awelo went up from KSh50 to KSh70. Citizen Digital reported that city bus and matatu fares rose 18.2%.

EPRA's current maximum pump prices took effect on 15 October and run until 14 November 2026. In Nairobi they are KSh226.96 a litre for super petrol, KSh227.76 for diesel and KSh219.87 for kerosene; in Mombasa KSh223.81, KSh224.61 and KSh216.71. The prices include value added tax (VAT) at 8%.

VAT on petroleum products was cut from 16% to 8% on 15 April this year for 90 days. The lower rate was extended for 90 days from 15 July, and again for 90 days under the Tax Laws (Amendment) Bill, 2026, which President William Ruto signed on 16 October. VAT on fuel had been raised from 8% to 16% on 1 July 2023 under the Finance Act, 2023.

The 7.3% headline inflation rate for October, up from 6.8% in September, was released by KNBS on 30 October. That is 0.2 of a percentage point below the 7.5% upper limit of the Central Bank of Kenya's target range. Core inflation, which leaves out volatile items such as food and fuel, rose from 4.0% to 4.3%, and non-core inflation from 14.0% to 15.1%.

Analysts at NCBA Group project inflation of 7% to 7.5% in December if international oil prices do not reverse significantly. They also see a higher risk that the Central Bank of Kenya tightens monetary policy.