Energy CS Opiyo Wandayi confirmed on Monday that Kenya has adequate petroleum stocks and secured import schedules through to the end of April 2026, even as US and Israeli strikes on Iran shut down tanker traffic through the Strait of Hormuz and put Kenya’s Sh700 billion in Gulf trade at risk.
- Kenya holds sufficient petroleum to cover domestic demand and regional supply obligations through April 2026
- Scheduled imports already contracted under the government-to-government framework with Saudi Aramco, ENOC and ADNOC
- The G-to-G deal fixes freight and premium costs until March 2028, insulating Kenya from spot market spikes
- Free on Board costs remain exposed to global price movements; pump prices will still reflect any sustained crude surge
- Iran’s Revolutionary Guards warned all vessels that transit through the Strait of Hormuz was prohibited after the strikes
- Around 20% of global daily oil supply passes through the strait; most major tanker operators have suspended shipments
- Asia, which sources roughly 60% of its oil from the Middle East, faces the sharpest disruption risk
- Kenya’s total trade exposure to the Gulf region is estimated at over Sh700 billion, covering fuel, palm oil, wheat and medicines
The strikes, launched on February 28, killed Iranian Supreme Leader Ali Khamenei and triggered retaliatory missile attacks on Gulf cities. Airlines suspended flights over Iranian airspace and insurance costs for vessels in the region spiked sharply. Brent crude hit a five-month high of $81.40 following earlier attacks on Iran’s nuclear sites before easing to around $70 per barrel following an uneasy ceasefire. Wandayi cautioned that while Kenya’s fixed freight arrangement provides a buffer, any sustained rise in Free on Board costs would still feed through to pump prices, as it would for all importing nations. The Ministry said it would continue monitoring developments and act to prevent supply disruption.
The Bigger Picture: Kenya’s G-to-G fuel deal was engineered precisely for moments like this. By locking freight and premium rates with three Gulf state oil companies through March 2028, Nairobi insulated itself from the kind of spot market panic now roiling global tanker markets. But the protection is partial. If Hormuz stays closed for weeks, Free on Board costs climb regardless of bilateral arrangements, and pump prices follow. The wider exposure compounds the risk: Sh700 billion in Gulf-sourced imports means the crisis touches food, medicine and manufacturing inputs, not just fuel. Kenya’s commercial oil production ambitions, targeting first barrels from Turkana by December 2026, suddenly look more strategically urgent than ever. A country that imports every litre it burns is always one chokepoint away from an inflationary shock.
Source: Ghanamma / Business Daily Africa
