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Do not trust snake oil salesmen fuelling lie of a petroleum ‘deal’

fuel, petrol

A pump attendant fills up a motorcycle at a petrol station on July 1.

Photo credit: Francis Nderitu | Nation Media Group

President William Ruto either lied to Kenyans or he was a victim of lies by key officials in his government. That is the only conclusion one can draw if Kenya is, indeed, seeking to renegotiate terms of the oil import deals with Saudi Arabia and the United Arab Emirates (UEA) as first payments under the six-month credit loom. 

It was only in March that the President heaped lavish praise on the officials who crafted the government-to-government arrangement, singling out Energy Cabinet Secretary David Chirchir, Council of Economic Advisers chair David Ndii and member Mohamed Hassan, and Energy and Petroleum Regulatory Authority Director-General Daniel Kiptoo.

The President said the quartet had done something phenomenal in putting together “a programme that has taken us away from looking for $500 million every month to buy our fuel needs, which was snowballing into a crisis... today, we can buy fuel in Kenya shillings, which nobody thought was possible”.

He went on to claim that the arrangement would ease pressure on the plummeting shilling, which he confidently asserted would in the following two months strengthen to between Sh115 and Sh120 to the US dollar, from the then-prevailing high of around Sh140. It was not to be.

Emirati oil exporters

Even then, there were red flags raised that the deal, which bypassed the established oil importation mechanisms, was not as good as it sounded.

First, it was clear to everyone that there was no way the Saudi and Emirati oil exporters would take payment in Kenya shillings. That was the first obvious big lie. The contract stated clearly in black and white that payment would be in US dollars.

And it also led to raised eyebrows on the President’s obviously misplaced confidence that the shilling would, as a result, strengthen significantly. It should have been clear that he had been lied to.

The government’s self-congratulatory mode also ignored the fact that, while a ‘buy now, pay later’ facility eased the monthly rush for dollars to pay for oil imports, it only postponed the inevitable. In six months, the first payments would fall due and, thereafter, it will be back to the regular cycle of monthly payments.

Deal over-hyped

Six months are coming to a close, and it is becoming clear that the deal sold as the magic bullet to Kenya’s foreign exchange crisis and oil import bills was over-hyped.

If anything, it resulted in Kenya paying higher rather than cheaper prices for oil because the fixed contract did not take into account fluctuations in the international market. Spot prices have gone down but we are stuck with the rates negotiated by those clever fellows.

The loser is the Kenyan motorist and other petroleum users now being forced to fork out more at the pump.

And now, we have a situation where the same snake oil salesmen are reportedly knocking at doors in Riyadh and Abu Dhabi after belated realisation that they cut a bad deal in the first place. They want to effectively reschedule the payments that fall due in September and also discuss more favourable pricing.

Should President Ruto trust the same fellows to again be the ones negotiating for Kenya? If they are already out there, what the President must do is recall them with immediate effect and hand them dismissal letters.

That is the least one can expect for fellows who lied to the President, and therefore forced him to mislead his people.

If his confident public assertions on the benefits of the oil import deal were based on lies from trusted officials and advisers, then the only way President Ruto will extricate himself from the whole murky affair is by getting rid of the entire lot. He has to demonstrate that he did not willfully lie to Kenyans but was misled by those whom he employed and trusted to do what was right for the country.

If he wants the public to believe that he was himself an innocent victim of falsehoods, which, in turn, forced him to convey misleading information, there is only one option.

President Ruto needs to regain public trust. He has to show that he is not a liar by mercilessly taking the axe to the lying cabals in his government. A public apology would also be in order.

While at it, Dr Ruto must also recognise that he is now the President of the Republic of Kenya. That way, he will get off the perpetual campaign mode of extravagant promises. He needs to get down to the real business of running the country. What Kenyans need from him now is delivery, not campaign rhetoric.

[email protected]. @MachariaGaitho