Energy CS Opiyo Wandayi under fire as MPs question impact of Sh1.4 trillion oil deal

Members of the National Assembly have raised serious doubts over the effectiveness of the Government-to-Government (G-to-G) oil import deal, questioning why pump prices continue to rise despite the state having paid over Sh1.4 trillion under the arrangement.

Energy and Petroleum Cabinet Secretary Opiyo Wandayi was on Tuesday hard-pressed to explain the persistent spike in fuel prices, even after the government renewed the deal, which was introduced in March 2023 to shield Kenyans from global oil market volatility and reduce pressure on foreign exchange reserves.

Wandayi, appearing before the National Assembly’s Energy Committee, was met with frustration from lawmakers who accused the ministry of failing to deliver on its promise to lower fuel costs.

Nyatike MP Tom Odege, who chairs the committee, criticised the ministry for hiding behind technical explanations while Kenyans continue to suffer at the pump.

“Kenyans are watching you today. Your technical team can cite freight and premium figures, but what people care about is why prices remain high. We expect you to defend their interests,” Odege told the CS.

The Energy and Petroleum Regulatory Authority (EPRA) on Monday announced new fuel prices for the period running from July 15 to August 14, 2025, increasing pump prices by an average of Sh9 per litre. EPRA cited higher global landing costs and pressure from the foreign exchange market.

In his response, Wandayi said the price increases were driven by a 6 to 9 per cent rise in international oil prices between May and June 2025. He said this led to a direct increase of Sh5.10 per litre for petrol, Sh5.90 for diesel, and Sh5.74 for kerosene.

Despite the ongoing criticism, the CS defended the G-to-G import framework, saying 170 cargo shipments had been delivered since 2023, with petroleum products worth $12.34 billion (Sh1.6 trillion) received. He added that letters of credit amounting to $10.9 billion (Sh1.41 trillion) had already been settled under the arrangement.

The G-to-G model allows Kenya to import petroleum, diesel and jet fuel on a deferred payment basis over 180 days, with the process coordinated by the ministry.

Still, MPs insisted the fuel deal had failed to cushion Kenyans and demanded to know why the reduced landing costs had not been passed on to consumers.

Wandayi argued that multiple taxes imposed on fuel products were also to blame for the final prices, and suggested that Parliament had a role in approving those levies.

“So, it is not this parliament that determines the price of food; there are so many things we can get into because there are issues of taxes, which country versus which country, which country taxes its citizens more. So, we need to really get the time, and I don’t want to go into those because I have so many points,” said Wandayi.

To back up his point, the CS compared Kenya’s freight and premium costs for July with those of Tanzania, saying Kenya paid $84 (Sh10,899) per metric tonne for diesel, $78 (Sh10,121) for petrol, and $97 (Sh12,587) for jet fuel. In contrast, he said Tanzania was paying $135 (Sh17,518) for diesel and $190 for jet fuel.

However, the committee questioned why, despite these lower charges, Kenyans continued to face high pump prices.

“To further clarify, I did not in any way imply that Parliaments or the National Assembly, for that matter, play a role in fixing petroleum product prices. No. But I did say that those taxes and levies that are imposed on petroleum products have to be approved by Parliaments,” Wandayi said.