- Govts meet in New York to rewrite global tax rules
- 350.org, global CSOs demand permanent taxes on extraordinary fossil fuel profits
Ben Eguzozie, in Port Harcourt
Elevated oil prices propelled by the U.S.-Israel-Iran war are expected to hit Kenya with a loss of $800 million by 2026-end, a country that is a net oil importer with no domestic petroleum production, according to new analysis by 350.org.
The report said the prices spikes have already imposed an estimated $340m on the East African nation since the start of the Iran war; and will cost between $770 million to $810 million in total by the end of the year in case of continued escalation.
Even in case of a swift normalization of the Strait of Hormuz and the region – recent weeks have seen renewed escalation and recorded concurrent rising prices – higher oil prices would cost the Kenyan people and businesses over half a billion Kenyan Shilling (between $490 million and $520 million) by the end of the year, the report added.
Kenya imports all its petroleum products needs, as it does not have any domestic production yet.
As a net oil importer with no domestic petroleum production, Kenya is acutely vulnerable to global fossil fuel price volatility, making direct shocks to its import bill a severe macroeconomic threat. Energy and transport inputs ripple across every sector of the country’s economy, driving up food and agricultural costs (via fuel and fertilizer), logistics, and baseline retail inflation, while putting intense downward pressure on the Kenyan Shilling and national foreign exchange reserves.
Many oil industry watchers believe it is in order to curtail future knock-on effects, especially during war situation that the Kenyan government worked hard to attract the $17 billion Dangote mega oil refinery on its Lamu Island along the Indian Ocean coast. The refinery will process 700,000 barrels per day, and supply refined petroleum products across East Africa.
In addition, Kenyan investors and institutions are said to have concluded to chalk-up $500 million investment accretion in the forthcoming Dangote Refinery initial public offering (IPO) listing in the Nigerian Exchange Group (NXG), with a possible secondary listing at the Johannesburg Stock Exchange.
350.org‘s analysis is based on oil and gas pricing scenarios of the International Monetary Fund’s (IMF’s) April 2026 World Economic Outlook, Kenyan consumption data and observed price averages since the start of the Iran war and Hormuz crisis.
The analytics company estimates do not yet account for wider knock-on effects, including rising fertiliser and food costs, lower economic output and employment, or rising inflation driven by fossil fuel price volatility. As a result, the true economic damage is likely to be significantly greater than the direct losses from higher oil and gas prices alone.
Loss while oil majors capture windfall profits:
Also, Kenya will witness a projected direct loss of up to $800 million diverts critical capital away from public investment, widening the trade balance and placing an unsustainable cost-of-living strain on households. This dynamic starkly underscores the economic exposure of importing fossil fuels while global oil majors capture windfall profits, intensifying local calls from climate advocates and civil society for Kenya to accelerate its shift toward decentralized, domestic renewable energy to build long-term economic resilience.
Ruth Agala, regional organiser for 350 East Africa said: “While international oil corporations record windfall profits from geopolitical instability, nations like Kenya are forced to pay the price. This projected $800 million loss isn’t just a statistical headline; it represents immediate, damaging pressure on household budgets, and vital public funds being drained from our national economy. It reinforces the urgent need to break our dependence on fossil fuels and rapidly scale up domestic, community-led renewable energy systems.”
Governments to rewrite global tax rules:
This week, governments are convening in New York for the next round of negotiations on a United Nations Framework Convention on International Tax Cooperation, to rewrite global tax rules, so countries can raise more revenue from multinational corporations and invest in climate resilience, public services and a just transition away from fossil fuels.
350.org says the UN Tax Convention is an opportunity to correct an unjust global system where profits are increasingly concentrated among multinational corporations, while the costs of climate breakdown fall disproportionately on households and countries least responsible for the crisis.
Analysis by the Global Alliance for Tax Justice and partners estimates that a 20 percent surcharge on the profits of the world’s 100 largest oil and gas companies could have generated more than US$1 trillion since 2015.
Only this week, five of the world’s biggest oil and gas companies reported a cumulative $48 billion in profits in the second quarter earnings season (TotalEnergies – $6 billion; Shell – $9.8 billion; Chevron – $12.1 billion; ExxonMobil – $14.5 billion; BP – $5.7 billion). Most of these oil majors are posting some of their highest profits since 2022.
Clémence Dubois, campaigns director at 350.org, said: “Every spike in fossil fuel prices acts as an unofficial tax on people: increasing the cost of transport, electricity and food, while governments spend billions responding to disasters and shielding households from high energy prices. Yet the companies driving both climate pollution and energy volatility continue to reap extraordinary financial rewards. It’s only fair that they contribute to the solutions.”
On its part, 350.org is calling for: Strong, permanent taxes on extraordinary fossil fuel profits, particularly during periods of war, market disruption and energy price spikes; stronger international tax rules that give countries, especially in the Global South, greater rights to tax multinational corporations; and public revenues from fossil fuel profits to be invested in renewable energy, climate adaptation and a fast, fair transition away from fossil fuels.
As governments negotiate the future of international tax cooperation, 350.org says they face a clear choice: continue protecting extraordinary fossil fuel profits, or ensure those responsible for the crisis help finance the transition to a safer, fairer and more resilient future.
