Uganda will now have the capacity to directly import fuel from producing nations, diminishing its reliance on Kenyan marketers, following a bilateral meeting in Nairobi.

Kenya's President, William Ruto, announced that Nairobi and Kampala have formalised a tripartite agreement concerning the importation and transit of petroleum products through their territories.

President Ruto emphasised that this agreement signifies a major shift, allowing Uganda to directly import refined petroleum products from producing countries.

This development comes as a resolution to trade tensions that had strained relations between the neighboring nations.

During President Yoweri Museveni's State Visit to Nairobi on Thursday, President Ruto highlighted the significance of this agreement in addressing Uganda's energy needs.

"We have just witnessed this agreement which enables the Uganda National Oil Company (UNOC) Ltd to import refined petroleum commodities directly from producer jurisdictions thus bringing to an end the challenges faced by the sector in Uganda," said Dr Ruto.

In addition to the agreement, discussions centered on extending the petroleum pipeline from Eldoret to Kampala, aiming to streamline direct exports.

Uganda, primarily reliant on Mombasa for 90 percent of its fuel imports, had previously expressed intentions to utilise its national oil entity, UNOC, for procuring and distributing petroleum products to its Oil Marketing Companies (OMCs).

This shift was prompted by Kenya's decision to engage in Government-to-Government agreements with Gulf nations. Uganda argued that this arrangement disrupted local fuel prices and heightened vulnerability to supply shortages.

Consequently, Uganda proposed redirecting a significant portion of its oil-related operations to the Port of Dar es Salaam, a move with potential ramifications for transit cargo at the Port of Mombasa.