Ruto Defends Kenya G-to-G Fuel Amid Uganda Comparison

• President William Ruto has defended Kenya's Government-to-Government (G-to-G) fuel deal, stating it is superior to Uganda's model.
• The debate was reignited by Ugandan President Yoweri Museveni, who claimed Uganda achieved lower premiums by sourcing fuel directly after previously using Kenyan intermediaries.
• Kenya introduced its G-to-G arrangement in 2023 to address severe foreign exchange pressures and a significant US dollar shortage, securing refined products on credit for up to 180 days.
• The Kenyan model involves agreements with Aramco Trading Fujairah FZE, ADNOC Global Trading Ltd, and ENOC, with local companies handling domestic logistics.
• Freight and premium charges under Kenya's G-to-G deal were renegotiated and reduced in September 2023 and again in March 2025.

President William Ruto has publicly defended Kenya's Government-to-Government (G-to-G) arrangement for importing fuel, asserting that the nation's adopted model is superior to Uganda's current system.

President William Ruto has publicly defended Kenya's Government-to-Government (G-to-G) arrangement for importing fuel, asserting that the nation's adopted model is superior to Uganda's current system. This defense comes amidst heightened scrutiny of petroleum procurement practices, sparked by recent comments from Ugandan President Yoweri Museveni. The debate intensified after Museveni revealed that Uganda had previously relied on intermediaries in Kenya for its petroleum supplies before transitioning to a different procurement method.

President Museveni elaborated that Uganda subsequently began sourcing bulk petroleum products directly, a shift he attributed to information provided by a Kenyan legislator. According to Museveni, this new approach, which involves Vitol and the Uganda National Oil Company, has resulted in lower premiums for diesel, petrol, and aviation fuel compared to their previous arrangement. This comparison has brought Kenya's own G-to-G framework under renewed public and political examination.

Kenya's G-to-G fuel importation arrangement was first implemented in 2023, a strategic move designed to alleviate severe foreign exchange pressures that were threatening both the country's fuel supply and its broader economy. At the time of its introduction, Kenya was grappling with a significant shortage of US dollars, with petroleum imports constituting a substantial portion of the national import bill. The Energy and Petroleum Cabinet Secretary, Opiyo Wandayi, has consistently upheld the necessity of this arrangement.

Under the terms of the G-to-G framework, Kenya entered into agreements with three major international entities: Aramco Trading Fujairah FZE, Abu Dhabi National Oil Company (ADNOC) Global Trading Ltd, and Emirates National Oil Company (ENOC). These agreements facilitate the supply of refined petroleum products to Kenya on credit terms extending up to 180 days. The primary objectives of this structure were to ease the immediate demand for US dollars, preserve the nation's foreign exchange reserves, and foster stability for the Kenya shilling.

A key component of Kenya's G-to-G framework involves the participation of local oil marketing companies. The international oil suppliers are permitted to appoint licensed Kenyan companies to manage the domestic supply logistics. Initially, Gulf Energy Limited, Galana Energies Limited, and Oryx Energies Kenya Limited were selected for this role, with One Petroleum Limited, Asharami Synergy Limited, and BE Energy Limited subsequently added to the roster. The government maintains that the involvement of these local companies is an integral part of the agreed structure with international suppliers, deemed essential for ensuring a continuous supply of petroleum products across the country.

Furthermore, the financial terms of the arrangement have undergone revisions. Cabinet Secretary Wandayi confirmed that both freight and premium charges associated with the G-to-G deal were renegotiated. These rates saw reductions in September 2023 and were further adjusted downwards in March 2025. President Ruto's current defense underscores his belief that Kenya's model offers a more effective mechanism for securing petroleum supplies while simultaneously managing the critical issue of foreign exchange pressures.

The ongoing debate highlights fundamental differences in petroleum procurement strategies between Kenya and Uganda, particularly concerning the roles of international suppliers, local oil marketing companies, pricing mechanisms, and the financing arrangements used to secure fuel. While Uganda has opted for a direct sourcing model citing lower premiums, Kenya's government continues to assert that its G-to-G framework was crucial in averting a potential fuel supply crisis and significantly reducing pressure on the country's dollar reserves.

President Ruto's steadfast position is that Kenya's model provides a robust framework for securing essential petroleum supplies. The Energy Ministry has echoed this sentiment, emphasizing the arrangement's role in safeguarding Kenya from a potential fuel shortage and alleviating strain on its foreign currency reserves. This public discourse underscores the complex economic and logistical considerations involved in ensuring national energy security, particularly in the face of global market fluctuations and domestic financial pressures.

Source: Original reporting via Capital FM