Rising fuel prices put a strain on Uganda air operators

UGANDA (eTN) – The weakness of the Uganda Shilling combined with rising international crude oil prices have driven fuel prices to new record highs in the country, with petrol now costing in excess of 3,500 Uganda shillings and diesel catching up fast, selling in some city stations already at 3,200 Uganda shillings per liter. One US dollar presently costs slightly above 2,400 UShs.

The situation has put a strain on local air operators cost structure as AVGAS remains both scarce and has reached record highs, while JetA1 aviation fuel continues to be the most expensive in the region.

Supply bottle necks from Kenya have also caused shortages of the precious liquids, and while government blames the Libyan crisis for failing to rehabilitate and restock the national fuel storage in Jinja, this was vehemently rejected by the business community as a smoke screen since the crisis was only of more recent making while the sorry state of the empty fuel tanks in Jinja has been going on for years.

Said one private sector representative: “It was pure negligence by government to let strategic fuel reserves run out. Like some years ago with electricity production, or the deteriorating road network some years back, some of our ministers are just so useless when it comes to forward planning and capturing strategic issues, so let the truth be known. The pipeline from Eldoret is also not moving ‘because of the Libya crisis,’ which is now a convenient excuse for just about everything. I hope the president brings in performers this time into key ministries to end years of disappointing performance in so many sectors.”

Few tour companies were willing to discuss the impact of the fuel price rises but it is understood that even safaris quoted in US dollars are now subject to reviewed quotations, so any traveler coming to Uganda with already pre-booked safaris should urgently check with their operator as to the latest developments.

Meanwhile, the population is suffering from running inflation, now well in excess of 10 percent, giving the incoming government already the first big headache of how to deal with this situation and bring inflation, supply deficits, and drought effects under control.