By Samson Tinka
Following the enactment of the Petroleum Supply (Amendment) Act, 2023, Uganda National Oil Company Limited (UNOC) has since December 1, 2023 held the exclusive role of importing petroleum products, which would subsequently be distributed to oil marketing companies (OMCs).
There were initially questions and doubt in corridors and streets on whether UNOC will be able to take on this task. The oil marketing companies were particularly worried about timely deliveries and replenishments.
Every morning, as I dropped my children to school, I flashed my eyes on the price boards of petrol stations to see if the prices were as I had left them 8 hours ago. It was common years earlier to find price differences overnight. And in most cases, prices would fluctuate upwards.
Many months down the road, the supply of oil products in Uganda has not only been super, but most importantly, Ugandans have seen semblance of price stability.
Sufficient oil products stocks
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 checked
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 excuse has since died out. To make matters better, a major influencer on prices, the dollar, has also been stable.
Small players survival.
The small players in the oil industry would struggle to survive because they would buy from the major players who of course add some markup in terms of pricing. These small fuel players would be expected to compete with the giants like Total , Shell, Stabex. The immediate shortcut for the small players would be adulterate the fuel by adding in other substances in order to increase the volumes and make some profit. This as well has either died out or scaled down. We can attribute this positive development to 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 sh37.6billion, six times the target which was sh6.989billion. The story of UNOC, and that of National Water and Sewerage Corporation, is a sign that government entities with able leaders and right structures in place can make profits that can be then spread to to other important social sectors like health, education and roads.
Prior to UNOC coming into the picture, there was rampant cases of fake lubricants include engine oils, brake and clutch fluids. These are critical lubricants because they impact on both the safety of the vehicle and its life span. Its common in Uganda to find that the cause of accident was purely mechanical like break failure. Cars developing engine knocks when they have run less than 150,000kms can be largely attributed to use fake or substandard lubricants.
UNOC show how
There is a visible change in the oil and gas industry in Uganda. Whereas its true that Petroleum Authority of Uganda has had a hand too, UNOCs impact has been seen, felt and acknowledged. Oil and gas will follow coffee and gold as other game changers to the social economic landscape in Uganda.
UNOC, as the sole importer of oil products, has had a positive impact to both the high end and the wananchi 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 Uganda’s economic growth.
It is time Government considered a similar agency to support the agriculture sector especially with genuine seeds and animal drugs.
With so many fake products on the Ugandan market, the biggest losers in this game are farmers in Kotido, Kazo, Ntoroko, Luwero and Mityana. Farmers harvest remains low even when rains are good and fertilizers used.
UNOC has proven that a Ugandan agency can change the tide to suit a local Ugandan and also make an extra cash for Uganda as a country.
The author is a safety and security consultant | Farmer from Nakasongola | tindsam@yahoo
