TANZANIA: Dealers hoard fuel to create scarcity and price hike

By Our Correspondent, DAR ES SALAAM Tanzania

The Tanzania Energy and Water Utilities Regulatory Authority (EWURA) yesterday reiterated its intention to revoke licenses of two fuel wholesalers and three retailing stations over continuous tendency of hoarding fuel in a bid to create shortage.

According to EWURA's Communications and Public Relations Manager, Titus Kaguo, the companies particularly hoard the fuel when the authority announces lowered monthly pump prices to create scarcity and price hike.

“These companies were creating shortages during times of low fuel indicative prices, which as results caused panic among consumers,” Kaguo stated yesterday in Dar es Salaam.

He mentioned the wholesaler as Mansoor Oil Industries Limited (MOIL) and Olympic Petroleum Tanzania Ltd based in Dar es Salaam.

The three fuel retailers are B.O.Five Ways Petrol Station (Bagamoyo), Mexon Energy (Makumbusho) and Mexon (Njombe).

“We initially gave them a 48-hour ultimatum to present their explanation to the authority regarding the matter and the authority arrived at the decision to embark on procedures for revoking their licenses after being dissatisfied with their explanations,” Kaguo stated.

He explained that the procedures include announcing in the newspapers over the authority's intent for inviting views from the public, thereafter the decision is taken. This procedure takes about seven days.

Kaguo noted that such dealers have been creating panic to the consumers, who have been rushing to buy large amounts of fuel and reserve in fear that there could be a scarcity.

The retail and wholesale prices for the petroleum products, imported through Dar es Salaam port, for June dropped drastically compared to prices recorded in May, 2020.

The current retail prices released by the regulator that took effect from June 6, shows cap price for a litre of petrol decreased by Sh348 (equivalent to 18.65 per cent), diesel dropped by Sh300 (16.25 per cent) whereas a litre of kerosene remained the same at Sh1,568.

Meanwhile, EWURA has announced that importation of fuel for August will rise by 52 per cent for petrol and 30.9 per cent for diesel as compared to a month of July, following the resumption of economic activities that were paralysed due to Covid-19.

The EWURA's Communications and Public Relations Manager, Kaguo said due to resumption of all economic activities, the authority expects an increase of fuel importation for August, reaching 157.9 million litres of petrol from 103.3 million litres for July.

On the other hand, the importation of diesel will rise from 176.1 million litres for July to 230.6 million litres for August.

He stated that petrol would approximately account for 89 per cent of fuel consumption for July, down from 94 per cent for June.

Likewise, the expected fuel importation for July would exceed an average consumption for that month by five per cent.

“EWURA management will closely follow up on the availability of fuel and if possible will direct local fuel companies to reserve fuel they intended to export to neighbouring countries for future local consumption,” Kaguo noted. - Africa