Vitol Bahrain backs Uganda’s oil supply chains: Vitol Bahrain, the Gulf-based arm of the Swiss commodity giant, is finalizing a USD 2 bn, seven-year loan to the Uganda National Oil Company (Unoc). The capital is earmarked for critical midstream and downstream projects, including oil storage terminals, pipeline connections, and the resumption of a long-stalled development of a USD 4 bn domestic refinery.

Why it matters

This is less of a traditional loan — and is more of an infrastructure-for-crude play. The funding carries a 4.92% interest rate — remarkably low for a market like Uganda, where sovereign yields often touch high double digits. The discounted rate is likely compensated for by structural control, with reports saying the loan is secured by future crude flows and managed through dedicated escrow accounts.

What’s in it for Vitol? By funding the storage and transport assets, Vitol is expanding its influence in Uganda. Since July 2024, Vitol Bahrain has been the sole supplier of refined petroleum products to Unoc. By funding these new projects, Vitol ensures it has significant influence over the Ugandan energy supply chain, from the points of import/production to the storage tanks.

Our take: Gulf-based capital is filling in gaps left by the West

Vitol’s move is part of a broader trend in Africa where Gulf-based entities and commodity traders are replacing Western banks, which have retreated on the backs of ESG mandates and high-risk lending. For example, a Western consortium led by Standard Chartered distanced itself from the USD 5 bn East African Crude Oil Pipeline in 2023, leaving a dunning gap that is now being filled by non-Western capital, including from Afreximbank, South Africa’s Standard Bank, and Saudi-based Islamic Corporation for the Development of the Private Sector (ICD) and Afreximbank.

The funding reflects a wider Gulf push into Africa’s resource economy, extending beyond energy into mining, where giants such as the UAE’s DP World and Mubadala are backing gold, bauxite, and lithium projects across Guinea, Mali, and the DRC.

There’s also the geopolitical angle: The Gulf-Africa partnership is driven less by sentiment and more by strategy, as Africa offers the Gulf a platform to counter expanding Chinese and European influence. Washington, meanwhile, has little objection to seeing its Gulf allies secure contracts over rivals such as China and Russia.

Background

The financing builds on a previously announced USD 4 bnagreement with UAE-based Alpha MBM Investments to develop a 60k bbl / d refinery, with Unoc retaining a 40% stake. Alpha MBM backing also came after a Western-led consortium (including Baker Hughes) retreated from backing the domestic refinery project in 2023.

About Vitol: Vitol is a Swiss-based multinational energy and commodity trader, with regional ownership and operational links. The firm is 10% owned by Adnoc and has stakes in oil refining, storage, and bunkering assets in the UAE and Bahrain.

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