UPDATE 2-Kenyan public transport operators call off strike after government cuts diesel price

Transport industry leaders, who stood with Ruto as he addressed ⁠the nation, called off next week's strike after he announced the further cut on Friday. FUEL PRICE CUT TO DEAL FURTHER BLOW TO ​PUBLIC FINANCES Ruto said his government had spent at least 28.1 billion Kenyan shillings to reduce fuel prices between April ⁠and June. The additional cut will deal a further blow to Kenya's strained public finances.

Kenyan public transport operators called off a strike that was due to resume next week after President William Ruto announced on Friday that the government ‌would cut diesel prices by more than 4%.

Public transporters staged a two-day strike this week against the rise in fuel prices in the wake of the Iran war. That brought economic activity in the capital Nairobi to a standstill, and devolved into clashes ‌between protesters and police that left four people dead and about 30 injured. In a televised speech on Friday, Ruto ‌said he had directed that the cost of diesel be cut by 10 Kenyan shillings ($0.0772) per litre in the June-July pricing cycle to provide additional relief to consumers.

The government, which each month sets a maximum fuel retail price that marketing companies can charge customers, last week hiked diesel prices by 23.5% ⁠to 242.92 ​Kenyan shillings a litre for the ⁠May-June pricing cycle, but reduced them by 10 shillings on Monday in response to the strike. Transport industry leaders, who stood with Ruto as he addressed ⁠the nation, called off next week's strike after he announced the further cut on Friday.

FUEL PRICE CUT TO DEAL FURTHER BLOW TO ​PUBLIC FINANCES Ruto said his government had spent at least 28.1 billion Kenyan shillings to reduce fuel prices between April ⁠and June.

The additional cut will deal a further blow to Kenya's strained public finances. Kenya's total debt service reached 71.2% of ordinary revenue in the ⁠2024/25 ​fiscal year, up from 50% four years earlier. Ruto, who is up for re-election in August 2027, has faced several rounds of protests about high living costs over the past three years. Nationwide demonstrations in 2024 forced him to withdraw $2.7 billion in ⁠proposed tax hikes.

He nevertheless said Kenya had been shielded from the worst of surging global crude prices by government-to-government fuel supply ⁠deals his government first struck ⁠with Middle Eastern governments in 2023. "Through the government-to-government fuel supply framework, we have secured guaranteed fuel supplies, despite global supply chain disruptions, ensuring uninterrupted fuel supply availability across the country," he said.

($1 = ‌129.6000 Kenyan shillings)