Home Crisis State strikes new payment deal to end biting fuel crisis

State strikes new payment deal to end biting fuel crisis

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Ministry of Petroleum & Mining PS Andrew Kamau.

Oil marketers will be compensated for extra volumes of fuel sold in the month to April 14, in a move aimed at helping ease the current supply hitches of super and diesel.

Principal Secretary for Petroleum Andrew Kamau gave the commitment on Tuesday saying that extra cargoes sold will be considered for compensation in the next pricing review set for next week.

The assurance will allay fears that had seen marketers reduce the stocks they supply to their branded retail outlets and also stopped selling to independent dealers leading to a nationwide shortage.

The fuel shortage started in the Western and North Rift regions before hitting Nairobi on Friday, triggering panic buying that saw some dealers increase prices and others limit the volume sold per motorist.

“This (letter) is therefore to approve the request by Supplycor to compensate the prudent cost of extra volume sold by OMCs (oil marketing companies) from March 15th to April 14th,” Mr Kamau said in a letter to the marketers on Tuesday.

The marketers had written to the ministry and the Energy and Petroleum Regulatory Authority (Epra) seeking assurances that the cargoes sold outside the pricing review will be compensated.