Fuel prices stability in Uganda, thank you UNOC

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OPINION

By Samson Tinka

December 1st, 2023, edition of The Uganda Gazette, published the Petroleum Supply (Amendment) Act, 2023. With the development, UNOC now held the exclusive role of importing petroleum products, which would subsequently be distributed to oil marketing companies (OMCs).

As usual, the noise was in corridors and streets on whether UNOC will take on this task right from the onset. The oil marketing companies were worried about timely deliveries and replenishments. Many months down the road, the supply of oil products in Uganda has been super, but most importantly, Ugandans have seen a semblance of price stability.

Personally, every morning as I drop my children to school, the first thing I would do is to flash my eyes on the price boards of petrol stations to see if the prices are as I left them 8 hours ago. It was common to find price differences over night. And in most cases, prices would fluctuate upwards.

Sufficient oil products stocks in place

One of the reasons for establishing UNOC was to help government improve its oil products stock-holding levels within the government and subsequently contribute to consumer and retail prices. This has been ultimately achieved. For the last 12 months or so, I have paid similar price for a litre of petrol from the gas station that I fuel from. The price stability has been felt for both fuel and lubricants.

Cost of living and inflation within check due to stabilized fuel prices

Cost of oil products have immediate impact on country’s inflation, cost of goods and services and overall cost of living. Before UNOC coming into this equation of oil products distribution, the cost of goods was unstable and one major reason fronted was because of fuel prices. This execuse has since died out. The make matters better, the dollar has been stable which has historically been an excuse put across on the other major factor on the pricing of goods and services in Uganda.

Small players survival

The small players in the oil industry would struggle to survive because they would buy from the major players who ofcourse add some markup in terms of pricing. These small fuel players would be expected to compete with the giants- Total , Shell, Stabex etc.

The immidaite remdy for the small players would be adulterate the fuel by adding in other substances inorder to increase the volumes and make some profit. This as well has either died out or scaled down. We can attribute this positive from UNOC intervention. Each player now in the oil and gas field can access fuel from UNOC tanks in Jinja at same price.  

UNOC made profits

UNOC a government institution made a profit of sh37.6b against a target of sh6.989b. This is almost 6 times more than the projected. Like National Water and Sewerage Corporation, a government agency that has made profits year in year out. It’s a sign that government entities with able leaders and right structures in place can make profits that can be deployed in other important social sectors like health, education roads etc.

Reduced cases of adulterated lubricants

Prior to UNOC coming into the picture, there was rampant cases of fake lubricants include engine oils, brake and crutch fluids etc,. Imagine fake engine oils and brake fluids. These are critical lubricants because they impact on both the safety of the vehicle and its life span.

It’s common in Uganda to find that the cause of accident was purely mechanical like break failure etc. Cars knock engines when they are still below 150,000kms and this can be largely attributed to use fake or substandard lubricants.

UNOC has changed the landscape of oil and gas industry in Uganda

There is a visible change of oil and gas industry in Uganda. Whereas it's true that the Petroleum Authority of Uganda has had a hand too, UNOC's impact has been seen, felt and a knowledge. Oil and gas will follow coffee and gold as other game changers to the social economic landscape in Uganda. The diligence exhibited by UNOC team in handling critical state matters is observed and acknowledged.

UNOC sole importer of oil products has had a positive impact to both the high end and the mwanaichi of country side. Transport costs can be predicted, movement of goods and services are well facilitated, the availability of petrol, diesel is guaranteed.  Fuel being the engine of any economy, its availability at all times has facilitated Ugandas economic growth.

As a Ugandan, i give a high 5 and a thumps up to UNOC because of this noble contribution. Its high time we get a similar agency to support the agriculture sector especially with genuine seeds and animal drugs. This is another area that fake products are too much and the biggest loser in this game is a farmer in Kotido, kazo, Ntoroko, Luwero and Mityana. Farmers harvest less compared to expected, even when rains are good and fertilisers used.

UNOC proved that a Ugandan agency can change the tides to suit a local Ugandan and also make an extra cash for Uganda as a country.

Receive my many thanks for the impact you have had on Ugandans and please keep it up. I hope by end of this financial year, your profit after tax will be in hundreds of billions.

The writer is a farmer from Nakasongola

tindsam@yahoo.com