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Uganda petroleum procurement and pricing dynamics

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2026-09-20 22:34 UTC → 2026-09-21 13:19 UTC · added ~~removed~~

Uganda has faced economic challenges regarding fuel pricing, characterized by ‘asymmetric price transmission.’ This phenomenon involves retail costs rising quickly in response to global crude oil increases while failing to decrease significantly when wholesale costs drop, creating a ‘ratchet’ effect that burdens the transportation, agriculture, and manufacturing sectors. In response to procurement concerns, President Yoweri Museveni criticized previous arrangements as a “government-to-middlemen” model that allowed Kenyan intermediaries to fleece the country. During reflections on his 82nd birthday, Museveni revealed that the late Kenyan politician Cyrus Jirongo had alerted him as early as 2019 to irregularities in Uganda’s petroleum procurement. To address this, Uganda transitioned to direct imports via the Uganda National Oil Company (UNOC) in partnership with Vitol. Officials report this shift has reduced fuel premiums for diesel, petrol, and aviation ~~fuel, although Uganda still relies on~~ fuel. Kenyan ~~port and pipeline infrastructure. Kenya’s Ministry of Energy and Petroleum~~ President William Ruto has defended ~~its own procurement arrangements, stating they were emergency measures implemented~~ Kenya’s government-to-government (G2G) fuel importation model, which was established in 2023 to ~~manage~~ mitigate US dollar shortages and ~~protect~~ ensure fuel security. Ruto argued the G2G framework is efficient and cost-effective, as it eliminates brokers by dealing directly with producers. Meanwhile, the Motorist Association of Kenya has previously called for a forensic audit of the Kenyan procurement system.

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