President William Ruto pledged to reduce diesel prices by at least Sh10 per litre in the June-July pricing cycle.
There is anxiety in the public transport sector as matatu operators await today’s announcement on diesel prices, which will determine whether President William Ruto’s pledge to lower fuel costs is honoured.
The President’s commitment to reduce diesel prices by at least Sh10 per litre in the June-July pricing cycle was a key factor in persuading operators to suspend a planned strike last month.
The Energy and Petroleum Regulatory Authority (Epra) is expected to announce new fuel prices today, with operators saying the outcome will determine whether confidence in the government’s intervention efforts is restored or tensions within the sector escalate.
“We are waiting for the prices to drop by Sh10 on Monday as we had been promised. That is what we are looking forward to. The rest of the issues we can address at a later date,” Matatu Owners Association chairman Albert Karakacha told Sunday Nation.
Matatu Owners Association (MOA) Chairperson Albert Karakacha (centre) spaeks to the media after President William Ruto met with transport stakeholders at the State House, Mombasa on May 22, 2026.
The diesel price reduction was among several commitments made by President Ruto during a May 22 meeting at State House, Mombasa, aimed at ending a transport sector strike that had paralysed the country.
If implemented in full, diesel in Nairobi would retail at about Sh222.86 per litre, down from the current record high of Sh232.86. Petrol currently sells at Sh214.25 per litre.
The pledge comes against a backdrop of rising global fuel prices linked to tensions in the Middle East. Increased oil market volatility has pushed up fuel costs worldwide and sparked concerns over the cost of living in Kenya.
Beyond fuel prices, uncertainty also surrounds promises on insurance costs and vehicle financing. During the State House meeting, President Ruto directed the Ministry of Transport and other agencies to engage financial institutions on possible debt relief measures for operators struggling to service vehicle loans.
Nearly three weeks later, operators say little information has been provided on the progress of those discussions.
Many PSV owners argue that while lower diesel prices would offer immediate relief, high insurance premiums, loan repayments and compliance costs continue to squeeze profit margins.
Among the proposals discussed was a moratorium on loan repayments for operators struggling with rising operating costs.
Sunday Nation has established that a committee bringing together representatives of the matatu industry, financial institutions, and the Ministry of Transport has already been formed to explore possible relief measures.
However, details of the talks and implementation timelines remain unclear, leaving operators uncertain about whether the promised interventions will materialise.
The government also assured operators that it would continue using the Petroleum Development Fund and tax measures to cushion consumers against global fuel price shocks.
Even so, the promised diesel reduction remains the main test of the government’s goodwill, with operators warning that failure to implement it could reignite frustrations that were temporarily shelved after the State House meeting.
The anticipated reduction has placed regulators in a difficult position, raising questions about how a Sh10 cut can be achieved if global market trends do not support such a decrease.
President William Ruto with transport sector stakeholders during a press briefing at State House, Mombasa, on May 22, 2026.
Sources familiar with the discussions say Epra officials have been grappling with the financial implications of implementing the President’s pledge in the absence of a clear funding framework from the National Treasury.
“If the prices naturally come down by Sh1 and we are told to reduce them by Sh10 as promised by the Head of State, then we expect the National Treasury to explain where the remaining Sh9 will come from. Will they provide a subsidy or how will they go about it?” said a source familiar with the deliberations.
Another official said Epra is under pressure to ensure the President’s commitment is reflected in the new pricing cycle despite uncertainty over how the reduction will be financed.
“We have no option but to honour the promise made by the Head of State. We will release the prices tomorrow and we are currently working to see what can be done,” the official said.
Fuel cargoes shipped between May 10 and May 31 will be priced using the average global fuel cost for April under a revised formula. Since April, prices have remained relatively high; the new pricing mechanism could limit the scope for a substantial reduction at the pump.
Signs of dissatisfaction are already emerging within sections of the matatu industry, with some leaders accusing negotiators who represented operators at State House of abandoning key demands.
Read: How to lower fuel prices
“There are some issues that we do not agree with, such as tinting matatus. It is a non-issue. We strongly believe that the issue of tinting matatus contributes to accidents, so we are not part of it,” said Paul Thiong’o, chairman of Forward Travellers Sacco.
Another issue addressed by President Ruto was the decoration of matatus. He directed the National Transport and Safety Authority (NTSA) to allow operators to retain artwork and graffiti on vehicles provided safety standards are maintained.
Mr Thiong’o said many operators felt the negotiations failed to address their most pressing concerns.
“The main problem we are having as matatu operators is the fact that those serving in current leadership positions have failed to deliver. They went there to serve their own interests and called off the strike. Other members within the Sacco have actually lost hope and are currently suffering silently because we got out of the negotiation table without getting what we wanted,” he said.
The concerns come despite assurances from Energy Cabinet Secretary Opiyo Wandayi that the government remains committed to implementing the President’s directive.
During a consultative meeting with manufacturers, Mr Wandayi said the government would ensure a further reduction in diesel prices during the June-July review period.
“In line with the commitment made by the President to the public transport sector and other industry players, the government will ensure further reduction in diesel prices in the next monthly review,” he said.
Matatus parked at Mountain View along Waiyaki Way in Nairobi on May 19, 2026 after Public Service Vehicle (PSV) operators went on strike over high fuel prices.
The CS noted that diesel remains a critical input in transport, agriculture and manufacturing, making affordability essential for economic growth and easing the cost of living.
“Lower diesel prices ultimately translate into lower costs for businesses and greater relief for Kenyan families,” he said.
Mr Wandayi also sought to calm fears over fuel shortages, saying Kenya had secured sufficient petroleum supplies through the end of July despite volatility in global energy markets.
“Fuel deliveries have already been secured through the end of July, ensuring uninterrupted supply and shielding Kenyans from shortages and disruptions experienced elsewhere,” he said.
The assurance comes amid growing concern among consumers who have already faced higher transport fares in some parts of the country as operators pass increased fuel costs to passengers.
Wilfred Bosire, chairman of the Mass Mobility Operators Association, said operators expected even greater relief than the Sh10 reduction announced by the President.
“The CS himself has been saying that the fuel supply in the country is stable and we have not in any way been affected by the price shocks. So, we expect that there will be adjustments to help us manage our operations,” Mr Bosire said.
Industry players argue that unless the diesel reduction materialises, commuters are unlikely to experience meaningful relief, further increasing pressure on households already struggling with the high cost of living.
There are also fears that divisions within the transport sector could deepen and trigger renewed calls for industrial action.
“What we need to do is sit down and have new leaders. There are so many issues that have been affecting the matatus but our divisions have threatened our ability to settle them,” said Mr Thiong’o.
Although government officials insist the President’s promises remain on course, matatu operators say they will judge success not by assurances but by the figures displayed at fuel stations from Monday morning.
Diesel remains the most important fuel in Kenya’s economy, powering public transport, agriculture, manufacturing and thermal electricity generation.
Kenya has spent Sh28.1 billion subsidising fuel prices since April, putting pressure on public finances. The subsidy fund held Sh17 billion at the start of April, and the sharp increase in support has fuelled concerns about its sustainability.
In addition to subsidies, the government halved the value-added tax on fuel to eight per cent, helping cushion consumers from even higher pump prices.
The subsidy fund is financed through levies of Sh5.40 on every litre of petrol and diesel and Sh0.40 on every litre of kerosene.
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