Wary of sanctions, Kenya cancels Iran oil deal


Kenya is cancelling an agreement to import 4 million tonnes of Iranian crude oil per year because of international sanctions against Iran, said its top energy official.

The news earlier this week that Kenya would turn to Iran for up to 80,000 barrels of oil per day surprised Western powers. Kenya is a key strategic ally in the U.S.-led fight against militant Islam in east Africa.

The deal, signed last month, came at a time that Western powers are increasing pressure on Tehran over its disputed nuclear programme, Reuters reports.
“We signed an MoU (memorandum of understanding), but it is being cancelled,” Patrick Nyoike, permanent secretary in the energy ministry told Reuters.
“There is an embargo on Iranian oil. We don’t want to get involved in the intricacies of international inter-governmental issues,” he said.

Britain, which earlier on Wednesday urged Kenya to reconsider the move, welcomed the about-turn. Officials said the UK government was pleased Nairobi was supporting the international sanctions.
“Concerted pressure by the international community sends a strong message to Iran that it must take steps to demonstrate its nuclear programme is for peaceful purposes,” a Foreign Office spokesman said.

Many importers of Iranian crude oil have sharply reduced purchases to earn exemptions from U.S. financial sanctions.

European sanctions, including a ban on imports of Iranian oil by EU states and measures that make it difficult for other countries to trade with Iran, came into effect on Sunday.

On Tuesday, Iran’s Mehr News Agency had quoted Seyed Mohsen Ghamsari, executive director for international affairs at the National Iranian Oil Company, as saying that “despite the stopping of oil exports to Europe, new contracts have been signed with other applicant countries”.

East Africa’s biggest economy imported oil from Iran in the 1970s and 1980s but has not since then.
“One of the new markets for the export of Iran’s oil is that of African countries,” Ghamsari was cited as saying.

The U.S. State Department said Washington was aware of the reports on Kenya’s intentions and that the United States in discussions with all international partners had made clear the importance of reducing ties with the Central Bank of Iran and revenue to Iran.
“We are implementing our sanctions fully,” the U.S. statement said.

Under President Mwai Kibaki, Kenya has increasingly turned to new economic partners, forging close ties with nations including China and Libya under Muammar Gaddafi’s leadership.

The shift in foreign policy stance has sometimes caused unease among its traditional western allies.

A visit by Iranian Vice President Mohammad Reza Rahimi to Kenya in late May paved the way for the deal, which was part of a drive by the two countries to increase trade ties including energy.

Aly Khan Satchu, a Nairobi-based independent analyst, said the agreement appeared hastily reached and that Tehran must have had “some purchase on the government”.

He added, “However, given the recent story about the arrest of two Iranian ‘operatives’ in Kenya, this deal to import crude looks uniquely ill informed and a little foolish.”

Kenyan police said they were interrogating two Iranians they arrested after seizing chemicals they suspected were going to be used to make explosives.