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"speaker_name": "Mr. Ojode",
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"legal_name": "Joshua Orwa Ojode",
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"content": "Mr. Temporary Deputy Speaker, Sir, I beg to move the following Motion:- THAT, taking into account the rampant poverty that has gripped many Kenyans; having regard to the fact that the pricing of petroleum products has been on a steep increase over the last couple of years; cognizant of the fact that any increase in prices on petroleum products affects the prices of almost all the commodities; and aware that arbitrary price increase on petroleum products only enhances the revenue of the multinational oil companies; this House grants leave to introduce a Bill for an Act of Parliament to amend the Petroleum Act, Cap.116, Laws of Kenya, in order to give power to the Minister responsible for matters relating to petroleum products to fix the maximum price in respect of sale of petroleum products. Mr. Temporary Deputy Speaker, Sir, this is not something new. I do not think I will even bore my colleagues in regard to persuading them to pass this Motion. You are aware that since the petroleum sector was liberalized more than a decade ago, petroleum firms have arbitrarily raised fuel pump prices whenever crude prices go up. I just want to give my colleagues information about what we import in terms of tonnage. The domestic demand for various petroleum fuels stands at 2.5 million tonnes per year. This is mainly imported from the Gulf region as either crude oil or refined oil. Mr. Temporary Deputy Speaker, Sir, for the last eight months, the Kenyan shilling has consistently strengthened against the dollar. The exchange rate has remained between Kshs70 and Kshs71 to the dollar. That gives importers real value for money, since crude oil is paid for through November 8, 2006 PARLIAMENTARY DEBATES 3489 the dollar. It means that the Kenyan shilling has given petroleum firms a huge boost and at the same time, cushioned importers from any issues arising from crude oil prices. The fluctuations are taken care of. Petroleum firms should have passed on this goodwill in order to trickle down to the consumers, but this has not been the case. The question we can generally ask is, why can the petroleum firms not pass the same benefits to the consumers whenever crude oil prices drop, or the exchange rate favours them? Why can it not go down to the consumers? This is the question we have been asking ourselves. Mr. Temporary Deputy Speaker, Sir, just two weeks ago, the Minister for Finance tried to persuade petroleum firms to reduce their prices, and they said no. The reason why they were saying no is because they knew very well that the Minister does not have any powers to use in regulating or setting up pump prices. It is common knowledge that in any country, when you want to have economic growth, the energy sector must be regulated. When you effect the increase of pump prices of any oil product, you have affected the common man, including those who are poor, and the poorest are in the rural areas. I said before that petroleum firms lack confidence in the ability of developing economies to be steady now and in the future, despite 40 years of consistent, steady, progressive civilian and democratic rule. They think that the developing economies will fizzle out tomorrow and there will be a coup. So, they would want to make obscene profit margins. That is why they do not care! Mr. Temporary Deputy Speaker, Sir, I have even been asking the petroleum firms to justify the increase of petroleum pump prices. For example, on Outering Road, there is a petrol station owned by BP Shell, and it is charging Kshs67.79 per litre of petrol. Why is it that the same company, with an outlet in town or on Mombasa Road, is charging Kshs82 per litre of petrol? That is why I have been saying that there is a cartel. Why should we have the same prices in Mobil, BP Shell, Total and Kenol/Kobil, if it is not a cartel? The same companies preach liberal economies, free market and free trade, yet they do not believe in them. The Government is not innocent either, because it has the capacity to rein in on oil marketers by purchasing crude supplies through the National Oil Corporation of Kenya (NOCK). The reason why NOCK was established was to give natural and market forces control, but they have failed. They were talking of loading arms; they were talking of the refinery being too expensive, but if, indeed, to refine crude oil is expensive to NOCK, the best they would have done was to ask the Government to subsidize the NOCK in order to remove the obsolete machines they are having. The refinery needs new machines and technologies in order for us to have cheap oil products. Why should we have kerosene retailing at Kshs67 per litre, yet it is a by-product? Why should we have diesel, which is also a by-product retailing at Kshs70 per litre? Why? These are some of the questions we are asking. They keep on saying: \"We are not making any money\". I will share with my colleagues here what these people are making, and I have researched on it. Mr. Temporary Deputy Speaker, Sir, why should this Government keep on giving tenders to private firms to import oil on behalf of others? Why can the Government not give some subsidies to NOCK? That is the question we are asking. Why did we establish NOCK then? Why? When you go to Narok, you will find the price of unleaded fuel at Kshs68.99 or Kshs69.99 per litre. There are no loading arms or storage tanks in Narok. So, why should Narok charge less than what we are getting in Mombasa, yet the refinery is in Mombasa and the ship docks there? Mombasa is everything; it is the gateway! Why? For example, Nakuru is charging much less than what is being charged in Nairobi. I always say that there must be something wrong with our prices, and that is why I am requesting my colleagues that, if the Minister is given powers to set or fix maximum prices based on your invoice, then the oil companies will be tamed. I understand that there is another Petroleum Bill which is coming. That Bill is drafted by the same multinational companies. So, I would like to urge my colleagues to pass my Motion in 3490 PARLIAMENTARY DEBATES November 8, 2006 order for us to tame these oil companies."
}