Museveni Reveals How Uganda Cut Petroleum Purchase Costs

KAMPALA, UGANDA — President Yoweri Museveni has credited Kenyan President William Ruto with helping Uganda secure access to Kenya’s petroleum infrastructure, as he defended a new fuel procurement arrangement that he says has significantly reduced import costs.

In a birthday message marking his 82nd birthday, Museveni said Uganda’s partnership with global energy trading company Vitol had lowered the prices it pays for diesel, petrol and aviation fuel while strengthening the country’s petroleum supply security.

From middlemen to direct suppliers

Museveni said Uganda’s previous petroleum procurement system relied on intermediaries in Kenya, a situation he claimed he only discovered around 2019 after a Kenyan senator, identified as Jirongo, brought it to his attention.

He said he subsequently tasked then Energy and Mineral Development Minister Irene Muloni with addressing the matter, but no meaningful changes were made until 2023, when Uganda began working with Vitol.

“The real story is that when we were fighting Idi Amin, among other things, we used to say that he had destroyed governance in Uganda by putting abatasoma (the ones that did not go to school) in charge of running the affairs of the Country.”

Museveni said the experience later taught him that even highly educated government officials could make decisions that harmed the country’s interests.

He questioned why Uganda had been purchasing petroleum products through middlemen instead of dealing directly with refineries and bulk suppliers.

Museveni outlines fuel cost reductions

According to figures cited by the President, Uganda’s initial agreement with Vitol, signed on August 18, 2023, resulted in lower petroleum purchase prices.

The figures represent reductions of USD 35 for diesel, USD 36 for petrol and USD 35 for aviation fuel per metric tonne.

The President did not provide details in the statement on the total annual savings or clarify whether the figures represented complete fuel prices or specific procurement components.

Museveni thanks Ruto for Kenya pipeline access

Museveni also acknowledged President Ruto’s role in facilitating Uganda’s continued use of Kenya’s petroleum infrastructure.

He said the Kenyan Government had allowed Uganda to pump petroleum products through the Kenya oil pipeline, in which Uganda holds a 20.15% shareholding.

“I want to thank H.E Ruto because he prevailed over some actors in Kenya who were trying to resist.”

The arrangement enables Uganda to maintain access to a vital regional supply route while changing how it procures petroleum products.

Uganda has increasingly sought to give the Uganda National Oil Company (UNOC) a greater role in importing fuel directly from bulk suppliers, reducing reliance on intermediary-based procurement.

Petroleum security and Africa’s integration

Museveni’s reflections extended beyond fuel procurement to Africa’s broader economic and strategic future.

He called on Africans to pursue what he described as three outstanding historical missions: economic prosperity through an integrated African common market, strategic security through political integration, and stronger unity among the continent’s linguistic and cultural communities.

He cited the proposed East African Federation as an example of political integration that could strengthen regional security.

“These are: prosperity for the Africans through integrating the African common market to help the wealth creators expand; strategic security against all threats through the political integration of the continent where possible, such as is the case with the East African Federation,” he wrote.

The President’s remarks come as Uganda expands its petroleum infrastructure, including the planned 320-million-litre Kampala Storage Terminal in Mpigi District, being developed by UNOC with Vitol Bahrain. The facility is intended to strengthen fuel storage capacity and improve the resilience of Uganda’s supply chain.

Museveni concluded by thanking Ugandans for birthday greetings and expressing hope that he and his wife, Janet Kataaha Museveni, would live to reach 100 and 96 years respectively.