Kenya Defends G-to-G Fuel Deal Amid Ugandan President's Middleman Claims

The Kenyan government has defended its Government-to-Government (G-to-G) petroleum import arrangement, saying it was introduced to address a severe shortage of US dollars that threatened fuel supplies and economic activity.

In response to Ugandan President Yoweri Museveni's remarks on September 17, the Ministry of Energy and Petroleum clarified that the program was designed to alleviate US Dollar liquidity challenges by ensuring accumulation of additional foreign reserves.

Museveni had stated that a Kenyan senator alerted him to Uganda buying petroleum products through middlemen in Kenya, prompting his government to change its procurement model and increase the role of the Uganda National Oil Company (UNOC).

The Ugandan president claimed that this move led to lower premiums for diesel, petrol, and aviation fuel. He cited examples: diesel premiums fell from US$118 to US$83 per metric tonne, petrol from US$97.50 to US$61.50, and aviation fuel from US$114.25 to US$79.25.