- Kenya’s oil fallout with Uganda late last year has amounted to an estimated $200 million loss in three months.
- The dispute originated from Uganda’s displeasure with Kenya over the country’s golf deal with the UAE and Saudi Arabia.
New data has shown that Kenya’s oil fallout with Uganda late last year has amounted to an estimated $200 million loss in three months. This is because Uganda opted for an alternative oil partner in October 2023. Kenya and Uganda have been at odds with each other since October last year over the future of their respective energy industries. In November, Uganda said it would begin working with Tanzania rather than Kenya for oil imports.
This month, Uganda decided to officially switch to Tanzania for oil imports after failing to get its national oil marketer, Uganda National Oil Company (UNOC), licensed in Kenya to ease imports through the Mombasa port. This dispute originated from Uganda’s displeasure with Kenya over a golf deal the country signed with the United Arab Emirates and Saudi Arabia, which Uganda deemed harmful. Uganda’s Energy Minister, Ruth Nankabirwa, stated that the alternative route could be expensive because of the logistics involved.
Still, it is possible to negotiate with the government of Tanzania to waive some taxes so that their sister country can do business. The energy minister noted that the dispute between both countries on the issue seemed to have been taking a positive turn, especially with the positive response from the president of Kenya, William Ruto. Still, actions so far have been contrary, including court cases. Uganda is Kenya’s primary trade destination for imported petroleum products, including super gasoline, diesel, kerosene, and Jet A-1 aviation fuel. Through Kenya, it imports over 900 million litres of petroleum products each month.