In an attempt to halt the fast slide of the Kenyan Shilling versus international currencies, Kenya's president William Ruto announced this spring the G2G oil supply agreement between Kenya and three major oil suppliers from the Gulf.
The Treasury stated in an International Monetary Fund (IMF) report that the plan has not been as successful as anticipated.
"The government intends to exit the oil import arrangement, as we are cognizant of the distortions it has created in the FX market, the accompanying increase in rollover risk of the private sector financing facilities supporting it and remain committed to private market solutions in the energy market," according to a quote from the Treasury.
The deal marked a switch from an open tender system in which local companies bid to import oil each month.
It was initially for 9 months but was extended for another 12 months to December 2024, after which date it will now be withdrawn.
Since the scheme's launch the shilling has depreciated by over 20 percent against the US dollar, surpassing the historical low mark of 160 to the dollar.
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