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Museveni’s pronouncement comes shortly after parliament passed a bill for the Uganda National Oil Business (UNOC), a state-owned oil business, to domestically buy and supply oil. This will end its dependence on neighboring Kenya for its oil needs.
“I have discussed this with H.E Ruto, the President of Kenya and our delegation is now in Dar-es-Salaam, discussing with Her Excellency Samia Suluhu,” Museveni revealed.
According to Energy Minister Ruth Nankabirwa, the goal is to “improve the security of supply of petroleum products to the country.”
The minister disparaged the current agreement with Kenya, stating that “it exposed Uganda to occasional supply vulnerabilities, Ugandan oil marketing companies being considered secondary whenever there were supply disruptions,” which hiked fuel prices in Uganda.
President Museveni in a social media communication yesterday, said for years, he’s been battling “parasites” in government. These have been reaping from the deals with the Kenyan fuel middlemen. These have created fuel price crisis in Uganda for years.
“Without my knowledge, our wonderful people were buying this huge quantity of petroleum products from middlemen in Kenya,” the president noted.
“A whole country buying from middlemen in Kenya or anywhere else!! Amazing but true. Why not buy from the Refineries abroad and transport through Kenya and Tanzania, cutting out the cost created by middlemen? Those involved were not bothered by these issues.”
Museveni went on to give a breakdown of the cost of the fuel from the middlemen that Uganda has been buying compared to the refinery prices, as follows:
1. Diesel:
I. Middlemen’s price – $118;
II. Price from bulk suppliers or Refiners -$83;
2. Petrol:
I. Middlemen’s price -$97.5;
II. Bulk suppliers or Refiners’ price- $61.5; 3.
3. Kerosene:
I. Middlemen’s price – $114; II.
Bulk suppliers or Refiners’ price – $79
These, according to the president are prices when the products have arrived at the East African Ports. Uganda imports petroleum products of the magnitude of 2.5 billion litres per annum valued at about US$ 2bn.
Kenya’s Mombasa port handles over 90% of the fuel imports of Uganda. Tanzania’s Dar es Salaam port currently receives the remaining gasoline imports from Uganda.
This latest development comes on the heels of the signing of an agreement. This is between Uganda and Vitol Bahrain EC, a Bahraini energy business. The Bahraini company would fund the Uganda National Oil business’s efforts to procure and supply oil.
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