The primary energy consumption in East Africa is expected to grow at a CAGR of more than 4% during the forecast period of 2020-2025. Factors such as increasing demand for refined petroleum products in the transportation and industrial sector are likely to drive the market in the forecast period. An increase in electricity generation from oil is also creating significant demand for refined products in East African countries. On the other hand, with a lack of investments and slow urbanization in some countries, growth is expected to be restrained in the forecast period.

  • Middle distillate oil products are expected to dominate the market in the forecast period owing to the demand in different sectors like power generation, transportation, and others.
  • With more than 150 million people without access to electricity in 2018, East Africa can create ample opportunities for electricity generation using oil and gas in the future.
  • Kenya is expected to dominate the market during the forecast period owing to the growing demand for gas and oil in the country.



Key Market Trends

Middle Distillates to Dominate the Market

  • Middle distillate refers to oil refined products situated between lighter fuel like gasoline and heavier fuels like fuel oil. It mainly comprises of jet fuel, kerosene, diesel, and others.
  • Ethiopia has witnessed an increase in the consumption of refined products in 2018. Jet fuel and Gasoil were leading in daily consumption at 2.4 million liters and 7.8 million liters per day respectively.
  • In 2019, Uganda announced the construction of its first oil refinery Albert Graben with an estimated capacity of 60,000 barrels per day. The refinery is expected to be operational by 2023, driving the market of refined products significantly.
  • With the growing demand in the transportation sector and power generation in different industries, the demand for middle distillates is expected to grow further to dominate the market in the forecast period.



Kenya to Dominate the Market

  • According to the International Energy Agency, the demand for gas consumption is expected to grow significantly in Kenya in the future, considering both African and Kenya’s ongoing policy scenarios.
  • In 2019, Kenya signed an agreement with London-based Tullow Oil, Canadian company Africa Oil Corp. and French supermajor Total for construction of an oil refinery. The refinery is expected to meet the growing demand significantly.
  • Kenya also witnessed growth in the consumption of light diesel with 215 Metric tons in July 2018 in comparison to 180 Metric tons in 2017.
  • The primary energy consumption of Kenya by oil is expected to reach more than 13 Mtoe by 2040, creating significant demand for refined petroleum products also.
  • With a growing population and demand to meet the electricity, the requirement is expected to drive Kenya to dominate the market in the forecast period.



Competitive Landscape

The East Africa refined petroleum products market is moderately fragmented. Some of the major companies include Total S.A., Royal Dutch Shell Plc, KenolKobil Ltd., National Oil Ethiopia Plc, Vivo Energy plc.

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