A proposed measure in parliament aims to reduce Uganda’s dependency on Kenya for the importation of its petroleum products, according to the Ministry of Energy and Minerals in Uganda.
The landlocked country wants to stop depending on Kenya for its petroleum needs, citing exposure to “occasional supply vulnerabilities” and rising pump costs in a statement released by the government on Tuesday.
“These vulnerabilities paused additional challenges, resulting in Uganda receiving relatively costly products and ultimately impacting the retail pump prices,” the statement said, citing Kenya’s government-to-government importation agreement with Saudi Arabia and the United Arab Emirates as the impetus for the action.
The ministry further states that should the bill become law, Uganda will continue to be in charge of overseeing the regulation of petroleum product imports into the country by giving the Uganda National Oil Company Limited (UNOC) the authority to find and provide petroleum products for its markets.
At the moment, Tanzania’s port of Dar es Salaam handles the remaining 90% of Uganda’s petroleum product imports from Kenya through the Port of Mombasa.
Through the importation frameworks in Kenya and Tanzania, the approved Ugandan Oil Marketing Companies (OMCs) handle the importation autonomously.
To assure supply security, Uganda will now make sure that buffer stockpiles are kept on hand, and Tanzania will be contacted if the country’s supplies are disrupted.
“To ensure that the policy change is implemented smoothly, the Ugandan and Kenyan governments are still in constant communication. The statement said, “Both countries share a commitment to regional stability and economic progress.
The law has so far received Cabinet approval and is awaiting Parliamentary approval.
This follows an unprecedented increase in fuel prices in Kenya, which has been attributed to the country’s high cost of living, though experts have expressed differing opinions.
According to the new pump price rules, a liter of gasoline costs Ksh.217.36 in Nairobi, Ksh.205.47 for diesel, and Ksh. 205.06 for kerosene.
