A warning from the Competition Authority of Kenya has put oil marketing companies on notice over alleged hoarding and anti-competitive practices in the fuel market, as concerns grow over reported shortages and distribution disruptions across the country.
The Competition Authority of Kenya said it has taken note of public concern over the availability of petrol, diesel, kerosene and Jet A-1 across the country, as well as remarks made by associations representing oil marketing companies.
It stressed that fuel remains a key product that supports daily economic activity and public welfare, warning that any interference in its supply chain would attract legal consequences.
In its statement, the Authority warned against actions that may deliberately interfere with normal distribution.
It stated that “Fuel is an essential commodity that underpins economic activity and public welfare,” adding that “any deliberate attempt by suppliers, distributors, or retailers of fuel products to withhold supply from the market to create artificial scarcity, manipulate prices, or gain unfair commercial advantage is a prohibited practice under the Act.”
The Authority also raised concern over allegations already circulating within government circles, suggesting that some oil marketing companies could be holding back fuel or selectively supplying non-franchised retailers in anticipation of price adjustments.
It noted that if such claims are confirmed, they would amount to serious violations of competition law.
It further pointed to the legal framework guiding the sector, stating that “Section 21(1) of the Act prohibits agreements or decisions by undertakings or their associations that have the objective and/or effect of preventing, distorting or lessening competition in the trade of any goods or services in Kenya.”
It also cited “Section 21(3)(f) and Section 21(3)(i), which bar discriminatory trade practices and conduct that restricts competition.”
On penalties, the Authority warned that firms found engaging in such conduct face heavy sanctions.
It said such actions “may attract a financial penalty of up to 10% of an undertaking(s) preceding year’s gross annual turnover in Kenya.” It added that offenders may also face imprisonment for up to five years or fines of up to Sh10 million.
While issuing the warning, the Authority noted that it continues to work alongside sector regulators to monitor the market.
It acknowledged the role of the Energy and Petroleum Regulatory Authority, stating that oversight in the petroleum sector is shared and coordinated.
“Whereas the Authority has the mandate to investigate and sanction anti-competitive conduct in any sector of the economy, it acknowledges the oversight powers of the sector regulator, the Energy and Petroleum Regulatory Authority (EPRA),” the statement read.
At the same time, EPRA has already raised separate concerns over how oil marketing companies are handling distribution. On Wednesday, Acting Director General Joseph Oketch said preliminary findings point to possible withholding of petroleum products from non-franchised retailers.
“Preliminary investigations indicate deliberate holding back of petroleum products by some OMCs to non-franchised retailers,” he stated, adding that “This practice amounts to hoarding and is a punishable offence under the Petroleum Act.”
EPRA also warned against overpricing and said strict action would be taken against any company violating supply rules, including possible licence revocation. The regulator further maintained that the country still holds adequate fuel stocks, even as distribution challenges continue to affect access in some areas.
Growing concern has also been echoed by transport operators, who say the situation on the ground does not match official assurances.
The Kenya Transporters Association reported that fuel access has become increasingly difficult, with widespread rationing affecting logistics operations.
“Over the past several days, Transporters across the country, particularly those operating along key logistics corridors, have reported widespread fuel rationing, refusal by marketers to supply in bulk, and a complete withdrawal of credit facilities by oil marketing companies,” KTA said.
The association added that drivers are now being forced to move from station to station in search of fuel, as bulk supply becomes more restricted across the market. It warned that the gap between official statements and real conditions on the ground continues to widen.
KTA further noted that if fuel stocks are indeed sufficient, then distribution should reflect that reality consistently and without disruption.
It also raised concerns over possible hoarding, supply constraints and manipulation within the distribution chain, saying the situation now spans at least 13 counties, including Nairobi, Mombasa and Eldoret.