Kenya secures bigger share of Rwanda’s fuel market with landmark petroleum deal

Kenya has strengthened its position as East Africa’s leading petroleum transit hub after signing a landmark agreement with Rwanda that will channel a significantly larger share of the landlocked country’s fuel imports through the Port of Mombasa and Kenya’s pipeline network.

• Kenya and Rwanda have signed three agreements that will route more of Rwanda’s fuel imports through the Port of Mombasa and Kenya’s pipeline network.
• The deal strengthens Kenya’s ambition to become East Africa’s leading petroleum logistics hub while improving Rwanda’s fuel security.
• Fuel volumes moving through Kenya are expected to increase more than tenfold, boosting revenue for the Kenya Pipeline Company.
• The agreement also reflects a broader regional shift toward government-to-government fuel procurement models.

The two countries on Monday signed three agreements establishing a government-to-government framework for transporting, storing and supplying petroleum products to Rwanda, a move expected to deepen regional energy cooperation while boosting business for the Kenya Pipeline Company (KPC).

The agreements comprise a memorandum of understanding between the two governments, a tripartite agreement involving Rwanda’s state-owned energy company, and a transport and storage agreement between the Rwanda National Energy Company and KPC.

Together, they create a structured framework for moving Rwanda’s fuel imports through Kenya’s petroleum infrastructure.

Under the arrangement, the first cargo covered by the new framework is expected to arrive at the Port of Mombasa between September 4 and 6, marking the official commencement of operations under the partnership.

Strengthening fuel security

For Rwanda, the agreement is designed to improve the reliability of fuel supplies by reducing logistical bottlenecks, creating more predictable import flows and strengthening resilience against regional and global supply disruptions.

The Rwandan government said the partnership forms part of its broader strategy to diversify import routes, enhance energy security and ensure adequate petroleum supplies to support industrialisation and long-term economic growth.

Designated institutions, including the Rwanda National Energy Company and KPC, will oversee implementation alongside government agencies from both countries.

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The agreement comes after global fuel supply chains were disrupted by recent geopolitical tensions, exposing the vulnerability of countries that rely heavily on spot-market fuel purchases and imported petroleum products.

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Major win for Kenya

The deal is also a commercial victory for Kenya. Energy Cabinet Secretary Opiyo Wandayi said petroleum volumes transiting through Kenya for Rwanda are expected to increase from about 50,000 cubic metres annually to more than 500,000 cubic metres, representing a more than tenfold increase.

The higher volumes are expected to generate additional revenue for KPC through storage and transportation services while reinforcing Mombasa’s role as the preferred gateway for petroleum products destined for East and Central Africa.

For years, Kenya and Tanzania have competed to serve as the principal transit corridor for fuel imports into landlocked countries such as Rwanda, Uganda, Burundi and eastern Democratic Republic of Congo.

By securing a larger share of Rwanda’s petroleum imports, Kenya strengthens its position in that regional contest.

Changing regional market

The agreement also signals a broader transformation in East Africa’s petroleum trade.

Like neighbouring Uganda, Rwanda is moving toward a government-to-government fuel procurement model that gives the state greater control over petroleum imports while reducing reliance on private oil marketing companies.

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According to industry reports, Rwanda’s fuel will be supplied under the new framework by OQ Trading, the Omani government’s international energy trading company, while Kenya will provide port access, pipeline transportation and storage infrastructure.

The shift is expected to reduce business for Kenyan oil marketers that have historically supplied fuel to Rwanda through commercial arrangements, even as it creates new opportunities for state-owned logistics providers such as KPC.

The latest agreement underscores the growing strategic importance of energy logistics in East Africa, where governments are increasingly seeking greater control over fuel supply chains following years of price volatility and geopolitical disruptions.

For Kenya, the partnership strengthens its ambition to become the region’s primary petroleum logistics hub by leveraging the Port of Mombasa, its extensive pipeline network and storage facilities to serve neighbouring countries.

For Rwanda, the agreement offers a more structured and predictable supply chain at a time when reliable access to petroleum products is becoming increasingly critical to sustaining economic growth, industrial development and regional trade.