The discovery of commercially viable oil reserves in Kenya has led to an increasing interest into the prospects that this nascent sector holds. Yet, general awareness around oil and information on its actual significance to Kenya is largely inadequate. Oil production and export will certainly provide an opportunity to kick-start economic growth in periphery counties and boost the national Government’s fiscal position, but it will not be a silver-bullet of poverty alleviation, as many perceive it to be.
Despite the recent burst of interest, the sector as a whole has been in existence since the early 1950s and Kenya’s consumption of oil products is one of the highest in the continent. This brief provides an outline of the oil sector and an analysis of its significance to economic growth and development in Kenya, debunking some of the assumptions and misplaced expectations of what value the sector actually holds for the country.