Uganda’s Minister of Energy presented a bill in parliament on Wednesday, proposing to bestow exclusive rights to the Bahraini company Vitol for sole petroleum product imports into the East African nation.
The amendments to the petroleum law have already secured approval from Uganda’s cabinet.
While the importation and marketing of petroleum products have traditionally seen a liberal approach, involving various private entities that primarily source products from neighboring Kenya, Uganda’s energy ministry released a statement expressing concerns about the current system.
They highlighted that this approach has exposed the landlocked country to supply disruptions and soaring pump prices.
A pre-existing agreement between Uganda National Oil Company (UNOC) and Vitol Energy has set the stage for Vitol to become the primary supplier of oil products to the Uganda National Oil Company.
Subsequently, the UNOC will distribute these products to petrol station operators. The initial consignment from Vitol is scheduled to reach Ugandan shores in January.
Nevertheless, the deal has not been without its detractors. Some oil marketing companies have criticized the move, alleging that the Ugandan government is attempting to establish a monopoly in the market.
According to the records of the country’s central bank, Uganda imported petroleum products worth $1.6 billion in 2022.
