Fuel trucks heading to Uganda
Uganda’s Minister of Energy and Mineral Development, Ruth Nankabirwa, has revealed that starting January 2024, all Uganda’s Oil and Marketing Companies will purchase their fuel and gas products from Uganda National Oil Company (UNOC) in order to end Uganda’s reliance on Kenya for its fuel supplies.
“To further benefit in having stable supply and improvement in pump prices, my Ministry is supporting UNOC to supply all Oil Marketing Companies in Uganda. It is planned that effective January 2024, Uganda’s Oil Marketing Companies will be directly supplied by UNOC which will improve security of supply and will result in very competitive pump prices,” said Nankabirwa.
The Minister made the remarks during the plenary sitting where she was updating Parliament on the status of rising fuel prices in Uganda where she informed Parliament that for the last one month, prices have not changed and the country has remained well supplied and assured Parliament that the Ministry will continue to monitor the sub-sector to ensure that Uganda’s market gets continuous supply of Petroleum Products through all the supply routes at competitive prices
However, Moses Ogwal (Dokolo North) asked the Minister, “Can you clarify whether we will not create a monopoly through UNOC? How are we going to avoid that?”
Faith Nakut (DWR Napak) remarked, “It is sad to note that Uganda is at the mercy of Kenyan importers. What is it that is making it difficult for UNOC to be an importer?”
Emmanuel Otaala (West Budama South) wondered if Uganda has the market for the quantities required by oil companies before such a deal is struck.
“She is planning that UNOC would be buying oil products directly for this country as opposed to our reliance on Kenya and the reason we have been relying on Kenya is that we as a country, we can’t buy directly from the oil producers because the badges require huge volumes which our country can’t order, I am just wondering how this is going to be done so that we can directly buy from the oil producers,” noted Otaala.
John Teira (Bugabula North) welcomed the move to end reliance on Kenya, but asked the Minister to clarify on accusations that some of the policies by Government are the reason for the high fuel prices.
He noted, “I am very glad that we are now thinking outside the box, to have UNOC our own to do the importation of our oil. However the information in the public is that it is the intention of this government to put up this mark up isn’t to bring the pump price down, but to generate revenue for Government until UNOC is stable enough to fund its own operations. I seek your clarification on that matter.”
Nankabirwa responded to the MPs concerns saying that the decision was reached after Government realized that Uganda doesn’t have a law that allows the Minister or any government company to come in and mitigate the problem of unreliable fuel supply, thus prompting for the need to cause amendments to the Petroleum Supply Act of 2003.
“Beginning January, we will not be going through the Kenyan system of Government to Government where they have committed us to take the products at whatever cost, so we want to run away from that,” said Nankabirwa.
She also revealed that a deadline of January 2024 has already been issued to the Kenyan Government, with President Museveni tasking Nankabirwa to hold talks with Kenyan President William Ruto about this new policy directive.
