Oil marketer, Rubis sold government bonds worth KES. 5.2Bn in the first half of the year period that ended in June 2025, an approach taken by most oil marketers to sustain their cash flow. In line with this trend, Rubis converted KES.4.6Bn worth of pending fuel subsidy dues into government bonds, that the company sold along with guarantees and deposits that the firm held in the Kenyan market which yielded KES. 5.2Bn.
This approach from oil marketers follows a directive from the National Treasury issued in June 2023, instructing oil marketers to swap KES. 45Bn worth of debt with a three- year bond, in a bid to settle the unpaid money for the fuel subsidy plan. According to the directive, each oil marketer was to take a bond that appropriated the amount the government owed from the subsidy.
Impact on oil marketers.
Since most of the oil marketers had experienced cash flow strains, this move has greatly alleviated this particular constraint as Vivo energy, the biggest oil firm in Kenya, reported to have made a profit worth KES.336million from the sale of its bonds for the fuel subsidy, early this year, and now Rubis appears to have gained good cash flow. The other oil marketers concealed their information regarding the amount of bond they took and whether they sold the bond or not.
On the other hand, the small-scale oil marketers were adversely affected since most of their money was withheld by the treasury, forcing them to turn to banks to unlock liquidity and ease any setback prompted by the conversion of debt into a bond.
Government`s view
The national treasury presented a fuel subsidy scheme that was to buffer Kenya`s from the skyrocketing fuel prices stemming from major upswings in fuel prices globally. From this, oil marketers were to retail fuel at prices lower than the prices released by EPRA, and later the government was to repay them the price difference. In the long run treasury had difficulty with cash flow which projected delayed payments to oil marketers, and it strategically directed the debt to be exchanged for a bond. The government apportioned the bond into two, with the first targeting KES. 17.8Bn and an interest rate of 14.22%.
