President Kenyatta clears Ksh.34 billion payments to oil marketers

President Kenyatta clears Ksh.34 billion payments to oil marketers

  • The allocation from the supplementary budget is expected to offset payments of Ksh.13 billion owed to marketers according to the Ministry of Petroleum while the balance is expected to foot future payments from the subsidy.
  • On Sunday, Petroleum Principal Secretary Andrew Kamau told NTV that the government would foot the OMCs bills on Tuesday.
  • The impasse on payments has seen widespread fuel shortages across the country with motorists and bodaboda riders’ queuing for hours on end to obtain the key commodity.

President Uhuru Kenyatta has signed the 1st 2021-2022 supplementary budget estimates into law clearing the path for the release of Ksh.34 billion to oil marketing companies (OMCs).

The assent of the bill is seen as timely in resolving the current fuel shortage which has been linked to product hoarding by OMCs as they push for the payment of arrears from the fuel subsidy.

The impasse on payments has seen widespread fuel shortages across the country with motorists and bodaboda riders’ queuing for hours on end to obtain the key commodity.

The allocation from the supplementary budget is expected to offset payments of Ksh.13 billion owed to marketers according to the Ministry of Petroleum while the balance is expected to foot future payments from the subsidy.

On Sunday, Petroleum Principal Secretary Andrew Kamau told NTV that the government would foot the OMCs bills on Tuesday.

The signing of the budget estimates is expected to now pave the way for the end of the fuel shortage impasse by allowing releases from the exchequer to the subsidy.

The government and OMCs have locked horns over the non-payment of the subsidy arrears with the Energy and Petroleum Regulatory Authority (EPRA) directing the marketers to release petroleum supplies even as they await payments from the fund.

EPRA has further threatened sanctions on dealers hoarding petroleum or selling products above the published price.

Kenyans who were forced to endure another shortage on Monday will now hope for wiring of the subsidy funds to the marketers and a quick restoration of supplies.

Long queues at petrol stations remain the norm for the better part of Monday in most parts of the country as the fuel shortage enters the second week.

The fuel shortage began on Monday last week with independent oil marketers being the first to fill the pinch in a matter EPRA initially blamed on a logistics hitch.

The energy sector regulator would later clear the air on the impasse on Saturday admitting to delays payments to OMCs from the subsidy fund.

 

Tags:

fuel shortage fuel subsidy Ministry of Petroleum

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