Rubis among oil firms under watch for 'unreliable supplies'

Some oil marketers are under scrutiny by the State following a prolonged widespread shortage of petroleum products at their outlets across the country, despite the availability of stocks at supply depots.

High-ranking government sources told the Nation that the country’s third largest marketer, Rubis, is among those under watch for “unreliable supplies”.

“We have surveyed outlets across the country and Rubis stands out as having some queer shortages and rationed sales,” a senior government official said.

“It’s worthy [noting] that other big marketers, such as Vivo and TotalEnergies, have sold a lot of products over the past two weeks and the discrepancy in product availability in outlets operated by particular marketers is a matter we’re concerned about,” the source added.

By the time of this article's publication, Rubis Energies Kenya Managing Director Jean-Christian Bergeron had not responded to calls and text messages by the Nation even though spot checks across the country revealed widespread shortages of petroleum products across its outlets over the past two weeks.

Ironically, data by the Energy and Petroleum Authority(Epra) shows the Nairobi Joint Depot (NJD), from where both Rubis and Total get their supply, had sufficient product stocks by late last week. By Thursday last week, the NJD had 1.59 million litres of petrol and 4.43 million litres of diesel products.

Total is the second largest fuel retailer in Kenya with a market share of 16.4 per cent as at last December, only behind Vivo Energy Kenya (21.7 per cent). Rubis is the third largest with a market share of 8.6 per cent.

Overall, the Epra inventory showed there was a total stock of 212 million litres of petrol and 188 million litres of diesel in the country by last Thursday but marketers only took about 9.5 million litres of petrol and 11 million litres of diesel for sale locally and for export.

Vivo held huge stocks of 3.18 million litres of petrol and 3.89 million litres of diesel at its depot in Nairobi last Thursday. 

On the same date, the marketer also had 2,796 litres of petrol and 11,209 litres of diesel at its depot in Mombasa — a position that corresponds to the high product sales by Vivo over the past two weeks as some of its rival curiously reported outages.

This comes as Epra intensified investigations on suspect export sales by some marketers when consumers in the local market went without supplies.

“The data of exports is being compiled and we shall be seeking answers on how some marketers had stocks to ship out of the country but none to sell locally,” a source said.

By yesterday, consumers still reported product shortages in Nairobi, Bomet and Migori as other parts of the country continued to experience lack of fuel.

This comes despite the government paying the subsidy arrears owed to oil marketing firms, which oil firms had cited as the reason for the fuel shortage as the delayed subsidy payment from the government hit them with significant cash flow problems. However, the government last week paid the oil firms Sh8.2 billion to settle a huge portion of the Sh13 billion it owes the firms, which had been expected to result in a swift resolution of the fuel shortage crisis.

A highly placed source at the Ministry of Petroleum told the Nation that the firms are deliberately hoarding the cargo in the hope of selling it a higher price after fuel price review by Epra on Thursday, which is expected to raise the product’s cost. 

Petroleum Principal Secretary Andrew Kamau last week hinted that large oil marketers could be holding onto fuel because they have been selling at a loss.

“The major oil companies, because they are the ones taking the burden, have had now to eat into their March cargo, which falls into next month’s pricing, which is higher. So they are obviously making a loss somewhere,” Mr Kamau said in an interview.

During a meeting with Presidential aspirant, Raila Odinga a few days ago, oil marketers also expressed concern that they were making losses. They asked if the losses would be factored into the imminent fuel pricing formula. 

Treasury CS Ukur Yatani last Wednesday openly accused the marketers of colluding to hoard the product.