Gov’t: “Don’t panic, fuel prices will return to normal soon”

Government, through the Ministry of Energy and Mineral Development, has assured the public that the fuel prices will return to normal soon once the long queues of trucks at the Kenya-Uganda border points of Malaba and Busia are cleared.

This comes as fuel prices continue to escalate with a litre of petrol now standing at Shs5,000 in some parts of the country. In Hoima, a litre is said to be selling at Shs10,000.

However, the energy ministry says it is a matter of time and the prices return to normal ranges and urged Ugandans not to panic.

“Uganda’s Oil marketing companies have most of their trucks in the traffic between the Kenya loading points and the borders and once cleared in a few days, supply and prices will return to normal and there is no need for the public to panic,” the energy ministry noted in a statement.

Government explains the hike in fuel prices

In a statement dated January 14, 2022, the energy ministry said the escalation in fuel prices is due to supply disruptions at Kenya-Uganda border points of Malaba and Busia, caused by mandatory Covid-19 testing of all truck drivers along the two border points.

“Supply was normal with trucks being cleared as usual and driver were allowed to present negative COVID-19 results from Kenya until January 1, 2022 when a directive was issued requiring all truck drivers to undergo testing at Malaba and Busia entry points. This resulted in a buildup of a queue of trucks as none were entering the country,” reads part of the statement by the Energy ministry.

The directive for mandatory Covid-19 testing of all truck drivers has seen over 4,500 trucks stall at Malaba and Busia something that has suffocated movement of goods and services along the two border points.

The energy ministry says failure to maintain replenishment of stocks and where trucks had spent ten (10) days in the queue, the turnaround time was affected and reduced stocks for petroleum products in the country.

The ministry highlighted that effective January 12, 2022, the Ministry of Health commenced free Covid-19 testing at the Busia and Malaba borders, and the trucks started moving, and the pace of truck movement has started improving.

The ministry further explained that the full opening of economic activities has seen an increase in uptake of petroleum products which resulted into a spike in consumption in the country that affected the 10-day stock levels.

“The very low replenishment based on the truck delays at the borders resulted in some stock out of Petrol at some outlets,” the ministry says.

Meanwhile, the ministry has warned speculators who are hoarding petroleum products and leading to unnecessary hike in fuel prices and advised them to desist from this bad practice.

“The price of Petrol in the country should not exceed Shs5,000 per litre. The cases of scarcity in districts such as Hoima will be addressed shortly with the ongoing replenishment,”

Uganda is a net importer of petroleum products in a liberalized downstream petroleum market with an average current daily consumption of 6.5 million litres. Uganda loads its products through the terminals located in Eldoret, Kisumu, Nairobi and Mombasa and supply is majorly through road transport.