South Sudan has flagged illegal fuel shipments from the port of Mombasa as Kenyan oil marketers bypass its Government-to-Government (G-to-G) deal.
Correspondence seen by Business Daily shows that Juba warned oil marketers on June 24 that fuel shipped outside the G-to-G framework risks being impounded, while companies involved face licence revocation.
South Sudan currently imports fuel under a G-to-G arrangement in which Kenya’s Pacific Petroleum is the designated importer of petrol and diesel. The company then supplies licensed oil marketers operating in the country’s retail market.
Pacific Petroleum admitted that it imported more expensive fuel cargoes outside the G-to-G framework following supply disruptions triggered by the US-Israel conflict with Iran.
The costlier cargoes have prompted other oil marketers to divert fuel originally destined for the Democratic Republic of Congo to South Sudan in an attempt to sell cheaper products.
“We would like to inform all OMCs (oil marketing companies) to comply and lift stocks nominated as per the signed SPAs from the supplier as we finalise the South Sudan Energy that will immediately take up the role and communications in future,” Santino Dau, Undersecretary at South Sudan’s Ministry of Petroleum, said in a letter dated June 24, 2026.
“We are working with all security apparatus to ensure the border is manned and regulated going forward. Any stocks not originating from the manifest of stocks imported for South Sudan shall be impounded at the border. Any sabotage to this arrangement will be met with legal action and licence revocation.”
A memo seen by Business Daily shows that one of the disputed cargoes was priced at $1,350 per cubic metre of diesel and $1,000 per cubic metre of petrol.
Kenyan oil marketers licensed to operate in South Sudan say those prices are uncompetitive, arguing that the premiums differ from those agreed under South Sudan’s G-to-G arrangement.
Logistics hurdles
A separate letter from Kenya’s Ministry of Energy and Petroleum shows that Pacific Petroleum has recently faced challenges evacuating products from the Kenya Pipeline Company (KPC) system and Gapco terminals. Gapco is owned by TotalEnergies Marketing Kenya.
The difficulties prompted Petroleum Principal Secretary Kello Harsama to convene a meeting with oil marketers to address the bottlenecks.
“In the recent past, Pacific Petroleum has faced several challenges in the implementation of the import arrangement, notably slow evacuation of product from the Gapco terminal and the KPC system,” Mr Harsama said in a letter dated June 22, 2026.
“To this end, we wish to invite you (seven oil companies) to a joint SDP, KPC and Epra meeting to deliberate on the most efficient way of handling the RSS import arrangement without negatively impacting the Kenyan Government-to-Government import framework.
The seven companies invited to the meeting were Pacific Petroleum, Be Energy, Asharami Synergy, Galana Energies, One Petroleum, Oryx Energies and Gulf Energy, all of which import fuel under Kenya’s G-to-G arrangement.
Kenya imports fuel through State-owned suppliers Saudi Arabia’s Aramco Trading Fujairah FZE, Abu Dhabi’s ADNOC Global Trading Ltd and Emirates National Oil Company Singapore Ltd.
Mr Harsama did not disclose the reasons behind Pacific Petroleum’s difficulties in evacuating products from KPC and Gapco facilities.
The delays suggest that nominated cargoes for South Sudan are not being lifted as scheduled.
A memo circulated to oil marketers shows that South Sudan has frozen requests to amend quantities allocated under the import programme.
“Kindly note that KRA (Kenya Revenue Authority) has received a memo that amendments relating to South Sudan should not be approved at this time,” the memo said.
Regional shift
South Sudan is the third East African country to adopt a G-to-G fuel import arrangement in a bid to improve supply security and cushion consumers from volatility in global spot markets.
Kenya introduced its G-to-G framework in March 2023 through agreements with three Gulf suppliers. Uganda followed a year later with a deal involving Vitol Bahrain, while South Sudan adopted its arrangement in March this year.
Rwanda became the fourth country last month after announcing a G-to-G agreement with Oman’s OQ Trading.
South Sudan has said its State-owned South Sudan Energy will assume the importer role from Pacific Petroleum. Rwanda has also established a State-owned entity to manage its fuel imports, while Uganda imports fuel through the Uganda National Oil Company.
The regional shift has increasingly concentrated fuel imports in the hands of State-backed entities, replacing the previous system under which dozens of oil marketers competed to import cargoes through open tenders.
