How unmoved Wandayi forced Kenya into a costly deal with Gulf Energy

In the final days of March, Kenya stood on the brink of a fuel crisis that would have shut down the economy. This crisis was caused by the incompetence of Energy Cabinet Secretary Opiyo Wandayi, whose failure to monitor Gulf Energy’s contractual obligations and lack of proactive contingency planning left the country exposed to a catastrophic supply shortfall.

As the country prepared for the Easter holidays, with demand for petrol surging by 20 per cent, the national stocks were so dangerously low that the government projected a complete stock-out by April 2.

Behind the scenes, a frantic race was underway, with senior government officials cutting deals.

Documents exclusively obtained by The Standard reveal how Gulf Energy Limited, a nominated oil marketing company entrusted with a critical fuel supply contract, failed to deliver, forcing the Ministry of Energy to invoke emergency powers and bypass the normal supply system.

A National Security Council Committee (NSCC) letter dated March 9 instructed the Ministry of Energy to explore and implement strategies to avert a national energy crisis, even if it meant going outside the government-to-government (G2G) deal. The ministry moved to avert an immediate disaster by awarding emergency contracts to One Petroleum and Oryx Energies.

The documents in our possession raise serious questions about Gulf Energy’s performance, the lack of any subsequent investigation, and how a company at the centre of a near-catastrophe remains in the loop for future business. The crisis was detailed in a series of high-level meetings of the National Supply Chain Committee, with minutes marked as ‘VAC’ (Vessel Allocation Committee) and dated March 18, March 24 and March 25.

The meetings were chaired by the Ministry of Energy and Petroleum and included the Kenya Pipeline Company, the Energy and Petroleum Regulatory Authority (Epra), and major oil marketing companies (OMCs).

The core problem was a single cargo, the PMS KG05/2026, an 85,000-metric-ton shipment of petrol assigned to Gulf Energy. The vessel, MT Elka Apollon, was meant to arrive between March 30 and April 1. But on March 18, the meeting heard alarming news when Gulf Energy admitted the vessel had a critical problem. “The vessel expected to deliver PMS KG05/2026, i.e. MT Elka Apollon, had loaded in Jebel Ali; however, it could not sail through the Strait of Hormuz,” read part of the minutes from the meeting.

The geopolitical closure of the strait was a legitimate crisis, but the Gulf’s proposed solution was partial and inadequate. They arranged two smaller medium-range vessels, MT Valery Roma and MT Fos Mercury, delivering only 76,000 metric tons in total, a shortfall of 9,000 metric tons from the nominated quantity.

By March 19, the situation was dire. A letter from the technical committee in the Ministry of Energy, addressed to Petroleum Principal Secretary Mohamed Liban and copied to Epra, shows a super petrol projection table with opening stocks of just 72,908 cubic metres. “Based on optimistic and peak demand, the projected super petrol cover days for Kenya and the region are 11 days…the country would likely run out of PMS from March 30, 2026.”

Wandayi was copied in on this letter and was aware of the imminent crisis.

As the stock-out date loomed, the ministry’s patience wore thin. Gulf Energy had been formally notified of the problem through a letter from Liban to Gulf Energy’s CEO, Paul Limoh, dated March 17. It acknowledged a delivery plan for diesel but then added a request: “Additionally, we kindly request that you update us on the delivery plan for the PMS cargo KG05/2026 whose date range is 30/03 - 01/04/2026 to guarantee security of supply for the country and the region.”

With no immediate response, two days later, on March 19, the State Department for Petroleum sent a terse email to Gulf Energy’s Charles Nyakundi. The subject line read: “Update PMS Delivery KG05/2026”.

The email was from the ministry expressing its frustration. “We are yet to receive your response on the delivery plan for PMS cargo ID KG05/2026, whose date range is 30/03-01/04/2026,” it stated.

“Please note that the lack of firm confirmation for delivery of the said cargo creates a supply gap, noting that the country is very lean on stocks.”

The ministry added a warning: “Therefore, to ensure security of supply, even as you plan on delivery of the cargo, the government is in the interim seeking alternative supply of PMS to shore up stocks that shall normalise the market.”

This was the first public hint that the government was preparing to bypass the normal G2G framework and find its own emergency supply.

On March 21, Gulf Energy finally responded with a letter to the Principal Secretary. In it, they provided a detailed chronology of their failure. “The delivery vessel for KG05/2026, Elka Apollon, arrived at the Port of Jebel Ali on 28 February 2026, ready for loading. Unfortunately, this was the same day on which the conflict in the Middle East escalated.”

The letter admitted the vessel was fully laden but “awaiting the reopening of the Strait of Hormuz.” Gulf noted they had provided the two smaller vessels and then, crucially, revealed that at the government’s request, they had engaged Saudi Aramco for an “additional” cargo of 40,000 metric tons of PMS, with a delivery window of April 1-3.

By now, the crisis had escalated to the highest level. A technical team, in a letter to Liban, notes that its recommendation for emergency cargoes was made “in view of the directive by NSCC”.

The NSCC, which is chaired by the president, directed the ministry to seek alternative deliveries outside the normal G2G framework. On March 18, during the VAC meeting, the ministry formally asked oil marketers for proposals for ‘contingency’ super petrol under special terms, which is payment in US dollars and delivery between March 28 and April 2.

Several oil marketing companies responded, including Hass Petroleum, Oryx Energies, E3 Energies and One Petroleum. But Gulf Energy was not among the initial bidders for this emergency tender.

After a technical evaluation, the ministry made its choice. “It is recommended that the offers by One Petroleum Limited (60,000MT, delivery date range 23rd to 26th March 2026) and Oryx Energies (60,000MT with a delivery date range of 05-10/04/2026) are considered as contingency PMS cargoes. CS Wandayi was copied on this recommendation and is aware of the emergency measures.”

The reasons were to “avoid stock out, counter the supply gap due to short delivery on KG04/2026 (17,500MT) and stabilise the market through building buffer stocks ahead of the Easter demand spike.”

On March 25, the ministry formalised the deals and, in a letter to One Petroleum Limited, Liban confirmed the delivery of cargo KGC01/2026, a 60,000-metric-ton shipment of PMS to be delivered between March 25 and 27. A separate, identical letter to Oryx Energies confirmed cargo KGC02/2026, also 60,000 metric tons, for delivery between April 5 and 7.

Even as the emergency cargoes were being confirmed, Gulf Energy was still scrambling. On March 21, they submitted a proposal for the 37,000-metric-ton cargo from Saudi Aramco, the MT NCC Najeem, with a delivery date of April 8-10, far later than the government’s needs.

Worse, the ministry noted that this cargo’s quality was substandard. The ministry letter to Gulf Energy dated March 25, acknowledges receipt of Gulf’s proposal but states: “We also note that the quality specifications are outside Kenya Standards. However, in the interest of the security of supply of petroleum products, an exemption shall be processed.”

The documents detail the waivers required, including a lower Research Octane Number (RON 91 vs. the required 93), higher sulphur content and the presence of manganese, a metallic additive not permitted in Kenyan fuel.

Despite these violations of the Kenya Bureau of Standards code, the ministry granted the exemption, and the cargo was accepted under the existing KG06/2026 allocations. Gulf Energy failed to secure the timely delivery of a contracted PMS cargo. Their initial vessel was stuck, their partial substitute left a shortfall, and their subsequent offers arrived late and with inferior quality.

The government, under direct orders from the NSCC, was forced to declare an emergency and hand-pick competitors One Petroleum and Oryx to save the country from an Easter fuel crisis.

Yet, as of today, there is no public indication of any investigation into Gulf Energy’s performance. Wandayi has not spoken about the company’s failure. No penalties have been announced and no suspension from the G2G framework. The company remains a nominated OMC and the ministry, in its letter to Gulf Energy dated March 27, says, ”We note that the quality specifications are outside Kenya’s standards; in the interest of security of supplying petroleum products, an exemption shall be processed”.

Copies of every critical letter from the March 17 query to the March 25 acceptance of substandard fuel were sent to Wandayi. The ministry, having averted a crisis, has moved on to the next import plan for April-June 2026, where Gulf Energy is again listed as a major importer.

A company that nearly caused a national fuel shortage faces no consequences.