Fuel Price Explained
Jan 06, 2003
THE 50% hike in crude oil prices on the world market and the escalating local exchange rate of the US dollar, have been cited as the main causes for the latest fuel charges increase.
By Vision Reporter
THE 50% hike in crude oil prices on the world market and the escalating local exchange rate of the US dollar, have been cited as the main causes for the latest fuel charges increase.
Fred Kabagambe-Kallisa, the energy ministry permanent secretary (PS) and Ivan Kyayonka, the country chairman Shell Uganda, yesterday blamed the pump prices rise on the two factors. Other local oil companies concurred with them.
By yesterday, virtually all oil companies, including the new entrants, had increased their pump prices by sh50. These included Shell, Gapco, Caltex, Total, Kobil, Petro Uganda, Hared Petroleum, Jovenna and others.
Petrol went up from sh1,530 to sh1,580 per litre, diesel now costs sh1,330 up from sh1,280 a litre while kerosene (paraffin) goes for sh1,190 from sh1,140.
Some filling stations had run short of petrol.
Yesterday, one US dollar was selling for sh1,870 while the buying rate stood at sh1,860.
The last fuel price increment was in June 2002 when petrol rose by sh50 from 1,480 a litre while diesel and kerosene were each raised by sh50 from sh1,260 and sh1120.
Last year’s price hike, was attributed to a 30% increase on fuel taxes contained in the 2002/2003 budget.
Kabagambe-Kaliisa said there was no problem with the fuel flow from Kenya.
“Local oil companies are obtaining their supplies direct from Nairobi and Dar-es-Salaam. But as regards the increase in pump prices, one can now look at the international oil prices and the US dollar exchange rate,†he said.
“About six months ago, a barrel of oil on the international oil market was costing between US$22 and US$23 but if you look at the price today, it has now shot up to $33 a barrel,†Kyayonka said.
Kyayonka said world stability, peace, the situation in the Gulf and the US and the European market play a big role in determining oil prices.
He said the situation in the Gulf, the leading oil producing region, would greatly determine the fuel prices world-wide.
“For instance, during the Gulf war (1990-1991 when Iraq invaded and occupied Kuwait), crude oil prices hit the highest level of US$40 per barrel,†Kyayonka added.
International news agencies yesterday attributed the price rise to the Venezuelan strike, a possible war in Iraq and the cold weather in the US.
Edwin Kugonza, the Caltex spokesperson, said in a statement, “Notably our pricing always puts into consideration freight costs, taxes, crude oil prices on the world market and the foreign exchange rates.â€
Ends
THE 50% hike in crude oil prices on the world market and the escalating local exchange rate of the US dollar, have been cited as the main causes for the latest fuel charges increase.
Fred Kabagambe-Kallisa, the energy ministry permanent secretary (PS) and Ivan Kyayonka, the country chairman Shell Uganda, yesterday blamed the pump prices rise on the two factors. Other local oil companies concurred with them.
By yesterday, virtually all oil companies, including the new entrants, had increased their pump prices by sh50. These included Shell, Gapco, Caltex, Total, Kobil, Petro Uganda, Hared Petroleum, Jovenna and others.
Petrol went up from sh1,530 to sh1,580 per litre, diesel now costs sh1,330 up from sh1,280 a litre while kerosene (paraffin) goes for sh1,190 from sh1,140.
Some filling stations had run short of petrol.
Yesterday, one US dollar was selling for sh1,870 while the buying rate stood at sh1,860.
The last fuel price increment was in June 2002 when petrol rose by sh50 from 1,480 a litre while diesel and kerosene were each raised by sh50 from sh1,260 and sh1120.
Last year’s price hike, was attributed to a 30% increase on fuel taxes contained in the 2002/2003 budget.
Kabagambe-Kaliisa said there was no problem with the fuel flow from Kenya.
“Local oil companies are obtaining their supplies direct from Nairobi and Dar-es-Salaam. But as regards the increase in pump prices, one can now look at the international oil prices and the US dollar exchange rate,†he said.
“About six months ago, a barrel of oil on the international oil market was costing between US$22 and US$23 but if you look at the price today, it has now shot up to $33 a barrel,†Kyayonka said.
Kyayonka said world stability, peace, the situation in the Gulf and the US and the European market play a big role in determining oil prices.
He said the situation in the Gulf, the leading oil producing region, would greatly determine the fuel prices world-wide.
“For instance, during the Gulf war (1990-1991 when Iraq invaded and occupied Kuwait), crude oil prices hit the highest level of US$40 per barrel,†Kyayonka added.
International news agencies yesterday attributed the price rise to the Venezuelan strike, a possible war in Iraq and the cold weather in the US.
Edwin Kugonza, the Caltex spokesperson, said in a statement, “Notably our pricing always puts into consideration freight costs, taxes, crude oil prices on the world market and the foreign exchange rates.â€
Ends