Oil prices are usually unstable due to the forces of demand and supply on the international market
As Uganda prepares to draw its first oil, Buliisa County MP Stephen Mukitale has called upon government to put in place mechanisms through which licensed oil companies will sell it to Ugandans.
In an interview with XFM, Mukitale revealed that oil prices are usually unstable due to the forces of demand and supply on the international market which in turn leads to fuel prices being hiked on the local market.
“The problem with the oil value chain is that crude oil volatility doesn’t necessarily relate with the downstream petrol station price” Mukitale said.
“It is true that crude oil has fallen from $120 to $35 but you will not find that change reflected at petrol stations because of the value chain. The pump price is still high” he added.
He said that clear cut mechanisms on how the oil is to be priced will not only help Ugandans to benefit from the resource, but will also contribute significantly to the country’s economic development.