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- According to the government, such deals would enable the country access favourable credit periods from suppliers and also transfer some part of the benefits to consumers in the form of lower pump prices.
The Kenyan government has introduced fresh regulations to facilitate government-to-government deals on fuel imports. According to the government, such deals would enable the country to access favourable credit periods from suppliers and also transfer some part of the benefits to consumers in the form of lower pump prices.
The government said that the government-to-government import deals of petroleum products will enable the country to negotiate for discounts on product cost and freight while also access extended credit periods from suppliers. Ultimately it will reduce the pressures on Foreign Exchange Reserves.
Kenya is currently negotiating to import a third of its fuel from the United Arab Emirates (UAE) on credit. State-owned National Oil Corporation of Kenya (Nock) is in talks with UAE to ship in 30 percent of the country’s diesel and petrol needs.
Nock proposes to sell the bulk of the UAE cargo to small independent dealers to reduce the dominance of oil majors who were blamed for fuel shortages. A State subsidy introduced earlier to ease fuel costs made wholesale prices almost the same as the cost of selling diesel and petrol at the pump, making the business unprofitable to independent players who buy supplies from the big players.
Also read;
https://trendsnafrica.com/fuel-shortage-in-kenya-acute/
https://trendsnafrica.com/fitch-slashes-kenyas-credit-score/
The Petroleum (Importation) Regulations, 2022, published in the Kenya Gazette seeks to make a compulsory requirement to import petroleum products through the Open Tender System (OTS) for efficient planning and to enable the country enjoy economies of scale.
