Media Centre

State of the Petroleum Industry – Briefing
Overview

The petroleum industry continues to play a vital role in supporting the regional economy, energy security, and development objectives. Despite global volatility in oil prices and shifting energy policies, the East African petroleum sector has shown resilience and gradual recovery post-pandemic. This briefing outlines key trends, challenges, and opportunities shaping the current state of the industry.

1. Market Performance
Demand: Petroleum product consumption has remained steady, with notable growth in diesel and LPG usage driven by the manufacturing and domestic sectors respectively.
Supply: The industry continues to rely on imports, primarily through the Open Tender System (OTS), ensuring a competitive and transparent supply chain.
Pricing: Retail fuel prices remain influenced by global crude prices, exchange rate fluctuations, and local tax regimes. Regulatory agencies continue to implement monthly price caps to stabilize the market.

2. Regulatory and Policy Landscape
The Petroleum Act, 2019 and the Energy Act, 2019 have been central to streamlining operations, licensing, and environmental standards in the sector.
Compliance with the Competition Act, 2010 has reinforced transparency and fair market practices.
Recent developments include ongoing reforms in fuel subsidy mechanisms and digitization of regulatory processes, including licensing and data reporting systems.

3. Infrastructure & Investments
Major infrastructure upgrades are underway, including pipeline expansions and terminal upgrades to enhance efficiency and storage capacity.
Cross-border pipeline projects and regional integration under the EAC framework are being explored to improve regional energy security and logistics.

4. Sustainability & Energy Transition
Stakeholders are increasing focus on environmental, social, and governance (ESG) practices.
Initiatives in clean energy, such as the promotion of LPG and adoption of cleaner fuels, are gaining momentum.
The industry is gradually aligning with the global energy transition narrative, though fossil fuels remain critical to meeting current energy demands.

5. Industry Data and Insights
PIEA continues to collect, verify, and publish reliable industry data through the Petroleum Insight Magazine, issued quarterly. More detailed data sets are available upon request at a nominal fee, supporting stakeholders with accurate, policy-aligned information for decision-making.

For data requests, please contact:
📧 analyst@petroleum.co.ke
📞 020 2249081 / 313046 / +254 722 221120

Conclusion
While challenges such as price volatility, supply chain disruptions, and policy shifts persist, the petroleum industry remains a cornerstone of the region’s economic and energy framework. Strategic investments, data-driven planning, and sustainable practices will be key to navigating the future.