Uganda increases stock of fuel products to 1 billion litres

Uganda is now stocking up to 1 billion litres of petroleum products, which are enough to last the country up to four months in case of a shortage of imports, the Uganda National Oil Company (UNOC) has said.

UNOC began importing petroleum products for Uganda in 2024 and the first delivery in the country was made in July, under a contract between the company and Vitol Bahrain EC, a Middle East bulk supplier of petroleum products.

According to the Ministry of Energy and Mineral Development, Uganda consumes about 240 million liters of refined petroleum products excluding aviation fuel per month

 But the ministry of Energy says UNOC has since shipped in two more vessels of petroleum products to increase the total stock in the country. 

“Part of our mandate is to make sure that the country is stocked up at all times; it ought to be noted that the UNOC is bringing in all products 100 percent apart from aviation fuel,” Patricia Litho, the Head of Communications at the ministry, says.

 One of the major reasons behind the government’s decision to create a state monopoly in petroleum importation was to ensure a stable supply that would result from challenges faced by importing through private marketing companies licensed by the Kenyan government. 

UNOC’s role is to import, store, and distribute the products to oil marketing companies, which then reach the last mile consumers through the retail companies. 

In ensuring adequate stockpiles, UNOC says it is also contributing to the falling prices at the pump stations over the last five months. 

In September, retail prices started dropping and have since relatively settled from a high 5,500 shillings per liter of petrol to 4,900 shillings at Shell and TotalEnergies stations, the two major distributors will a quarter of the market share. Diesel goes for an average of 4,600 a liter. 

Other retailers quote a liter at between 4,750 and 4,599 Shillings, while they are selling diesel at 4,288. While stating his reasons as to why Uganda should import the commodity directly instead of through Kenya-based middlemen, President Yoweri Museveni said in December 2023 that the then prevailing method was leading to the overpricing for Ugandans. 

He said that bulk suppliers priced a liter of petrol at 83 dollars (305,400 shillings) per barrel, but that the middlemen sold it to Uganda at 118 dollars (434,000 shillings in today’s exchange rate), gaining more than 40 percent.