EXPLAINER: Why fuel is running tight across Kenya

‎From Nairobi to Eldoret and Nyeri, the shortage has disrupted transport, driven panic buying, and raised fresh questions about the country’s energy security.

‎While the crisis may appear sudden, it is the result of a complex mix of global shocks, market behaviour, and structural weaknesses within Kenya’s fuel supply chain.

‎At the heart of the shortage is a major global disruption- the ongoing conflict in the Middle East, particularly involving Iran. 

‎The war has interfered with the flow of crude oil through the Strait of Hormuz, a key global shipping route that handles a significant share of the world’s energy supplies. 

‎Kenya, which relies almost entirely on imported refined petroleum, is especially vulnerable to such external shocks. 

‎With shipments delayed or reduced, local supply chains have come under pressure, creating gaps in availability at retail stations. 

‎Energy Cabinet Secretary Opiyo Wandayi has, however, sought to reassure the public that the situation is under control. “

"We wish to reassure the public that there are sufficient stocks of petroleum products to meet current demand,” he said amid growing concern over shortages. 

‎“This action posed a risk to the integrity of a system that has consistently safeguarded supply security and pricing stability,” Wandayi said while addressing the controversial importation of a 60,000-metric-tonne fuel consignment that has since been withdrawn.

‎The consignment, imported outside the government-to-government (G-to-G) framework, has become a major flashpoint in the crisis. 

‎Authorities argue that its entry disrupted the carefully managed supply system, creating uncertainty among oil marketers and triggering instability in distribution.

‎Wandayi warned that the shipment, priced significantly higher than G-to-G fuel, could have pushed pump prices up by about Sh14 per litre, further incentivising speculative behaviour in the market. 

‎Despite these assurances, the reality on the ground tells a different story.

‎One of the most immediate drivers of the shortage has been panic buying. 

‎As news of global disruptions spread, motorists rushed to fill their tanks, often purchasing more fuel than usual. 

‎This surge in demand has overwhelmed supply chains, leading to visible shortages in several parts of the country. 

‎Closely linked to this is the issue of hoarding by fuel marketers. 

‎Industry insiders and government officials say some oil dealers have withheld supply in anticipation of future price increases. 

‎By limiting what is available now, they position themselves to sell at higher prices later.

‎According to the Energy Ministry, such practices have significantly worsened the situation. 

‎A statement from the Petroleum Principal Secretary noted that “the fuel shortage… was primarily caused by hoarding of fuel by oil marketers… anticipating a shortage.”

‎This behaviour has created artificial scarcity in some regions, even where national stock levels may appear adequate.

‎Compounding the problem is a pricing mismatch. 

‎The Energy and Petroleum Regulatory Authority (EPRA) has kept pump prices relatively stable despite rising global oil costs. 

‎While this protects consumers in the short term, it has discouraged some suppliers from releasing stock, as they anticipate better margins in the near future.

‎Retailers, caught between rising import costs and controlled pump prices, have reduced supply or slowed distribution, further tightening availability at the pump.

‎Beyond immediate triggers, the crisis has also exposed deeper structural weaknesses in Kenya’s energy sector. Experts warn that the country lacks sufficient strategic petroleum reserves, leaving it ill-prepared to absorb global shocks.

‎Without a large quantity of stored fuel, Kenya depends heavily on continuous imports. 

‎Any disruption, whether from geopolitical conflict, shipping delays, or market speculation, quickly translates into shortages on the ground. 

‎Energy analysts have cautioned that unless strategic reserves are expanded, similar crises could recur whenever global supply chains are strained.

‎The economic ripple effects are already being felt. Transport costs are expected to rise as matatu operators and logistics companies pass on higher fuel expenses to consumers. 

‎Businesses that rely on transport, from agriculture to retail, face increased operating costs and potential losses.

‎In some areas, motorists have been forced to travel long distances in search of fuel, while others resort to buying more expensive premium products due to the unavailability of regular petrol.

‎The Kenya Transporters Association (KTA) says the problem is not just supply, but access.

‎“Transporters…have reported widespread fuel rationing, refusal by marketers to supply in bulk, and a complete withdrawal of credit facilities,” said KTA chairman Newton Wang’oo.

‎The Central Bank of Kenya has also flagged rising global energy prices as a key risk to inflation and economic stability, underscoring the broader impact of the crisis. 

‎For now, the government maintains that the shortage is temporary and largely driven by market behaviour rather than a complete lack of supply. 

‎CS Wandayi has urged Kenyans not to panic or hoard fuel, warning that such actions only worsen the situation.

‎At the same time, pressure is mounting on authorities to tighten regulation of fuel marketers, improve transparency in the supply chain, and invest in long-term solutions such as strategic reserves and diversified sourcing.

‎The Kenya Pipeline Company (KPC), which manages the country’s fuel transportation and storage infrastructure, has also moved to calm fears, insisting that there is no nationwide shortage.

‎According to KPC, the country has “sufficient fuel stocks” to meet demand, pushing back against claims of depletion.