New twist as Kenya cancels controversial petrol order
John Mutua
April 7, 2026
The State on Tuesday ordered the exit of 60,000 tons of contested petrol from the country amid fears that part of the emergency cargo had been consumed over the Easter holidays.
One Petroleum, which is associated with Mombasa tycoon Mohamed Jaffer, had imported the Sh11.8 billion cargo outside the Government-to Government (G-to-G) following fears that the country’s stocks would deplete on March 30.
Energy and Petroleum CS Opiyo Wandayi directed the firm to remove the product from the storage system of Kenya Pipeline Company (KPC), barred oil marketers from selling the cargo and also directed them not to pay the bill invoiced by One Petroleum.
He reckoned that the emergency importation of fuel is in breach of supply contracts Kenya inked with Saudi Aramco Trading Fujairah, Abu Dhabi’s ADNOC GlobalTrading Ltd, and Emirates National Oil Company Singapore Ltd, arguing that the all of which are meeting their contractual obligations.
The State alleged that the emergency shipment that followed supply disruption triggered by was overpriced, of substandard quality, and procured at rates significantly higher than those agreed under existing deals, leading to a Sh14 a litre rise in pump prices.
Oil marketers reckoned that part of the contested cargo had entered KPC’s system and evacuated to dealers depots and possibly flowed to motorists’ tanks.
The marketers reckoned they had been invoiced with One Petroleum, which yesterday said it will comply with the State directive, arguing it will ensure that the cargo that landed in Kenya on March, 27 does not enter the market.
Mr Wandayi says One Petroleum cargo was illegally imported and that it could have led to a rise of Sh14 per litre of fuel in the new prices that will come into force from April 15.
Three top State officials in the energy docket resigned on Saturday over the deal.
“In addition to the measures already undertaken, One Petroleum is directed to exit this product out of Kenya as soon as possible, oil marketers should neither pay the invoice nor uplift product form this consignment,” Mr Wandayi said on Tuesday.
Mohamed Liban, the Principal Secretary for Petroleum, Joe Sang, the Managing Director of KPC and Daniel Kiptoo, the Director General of the Energy and Petroleum Regulatory Authority (Epra) resigned last Saturday, two days after their arrest.
But oil executives have poked holes into Mr Wandayi’s directive, saying that it is unrealistic and a populist move which has raised more questions and one that could see banks become jittery over funding importation of fuel.
“This move is baffling and unrealistic. Most OMCs have already taken the fuel and it is mixed with previous stocks, either in KPC systems or private storage tanks. Motorists have also bought this fuel, so how do we recall it?” said an executive who spoke on condition of anonymity.
“A bigger concern is that banks will sit back and become skeptical that if a rightfully awarded importation of fuel can be said to be illegal, then what comfort do we have in financing other cargoes in the future?”
Kenya has since March 2023 been importing fuel via the G-to-G deal with Saudi Aramco, Abu Dhabi National Oil Company (Adnoc) and Emirates National Oil Company (Enoc) on a credit period of 180 days.
The country on March 18 was forced to seek alternative sources of fuel and ease dependence on the Gulf region after one of the vessels carrying 85,000 tonnes of petrol under G-to-G was unable to leave the Port of Jebel Ali in Dubai due to closure of the Strait of Hormuz.
Gulf Energy, the importer of the petrol cargo then shipped two smaller vessels carrying a total of 76,000 tonnes, leading to a shortfall of 9,000 tonnes.
The shortfall exacerbated fears that Kenya could run out of petrol by April 4, 2026, a scenario that saw the National Security Council Committee (NSCC) approve importation of emergency cargoes on March 9, 2026.
One Petroleum, Oryx Energies, Hass Petroleum and E3 Energies then bid to import the emergency cargoes of petrol.
Oryx quoted a price of $253.93 (Sh33,031.21) per tonne for its 60,000 tonnes of petrol while One Petroleum quoted $290 (Sh37,723.2) per tonne for a similar quantity.
E3 Energy quoted $368.40 (Sh47,921.47) for 37,000 tonnes while Hass quoted $420 (Sh54,633.60) for 38,000 tonnes and a similar amount for a delivery of between 22,000 to 60,000 tonnes.
One Petroleum confirmed it would deliver its cargo between March 23-26, 2026 while Oryx committed to deliver its consignments between March 25-April 20 2026.
“It is recommended that the offers by One Petroleum (60,000 metric tonnes), delivery range date of March 23-26, 2026) and Oryx Energies (60,000 metric tonnes with a delivery date range of April 5-10, 2026) are considered as contingency PMS (petrol) cargoes,” the Ministry of Energy and Petroleum says in one of the documents.
“This is in view of the directive by NSCC and to avoid stock-out noting the cover days and expected delivery date on KGO6A, i.e. April 3-5 2026.”
KG06A/2026 is the vessel ID for MT NCC Najeem, the ship that Gulf Energy had tapped to ship in 35,000 tonnes of petrol that was to be delivered at the port of Mombasa between April 1-2, 2026.
Immediate former Principal Secretary in the State Department of Petroleum, Mohamed Liban in a letter dated March 25, 2026 notified Oryx and One Petroleum that they had been picked to import the emergency cargoes.
Mr Wandayi last week said that Oryx was barred from discharging its cargo, adding to the spin surrounding the importation of the emergency supplies of petrol.
→ jmutua@ke.nationmedia.com
Kenya has since March 2023 been importing fuel via the G-to-G deal with Saudi Aramco, Abu Dhabi National Oil Company (Adnoc) and Emirates National Oil Company (Enoc) on a credit period of 180 days.
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MY TAKE
Once upon a time buisnessman Jaffer used to pay Businessdaily to tarnish the image of Rostam Aziz! Now he is being exposed!
