Fuel prices drop on shilling's strength

Pump prices for petrol and diesel at filling stations will go down by 48/- and 54/- per litre respectively, starting today, according to a monthly cap price for the local market announced by the industry regulator on Tuesday.

The Energy and Water Utilities Regulatory Authority (EWURA) Principal Communications and Public Relations Officer, Mr Titus Kaguo, told a news conference that prices for kerosene have remained the same.

Mr Kaguo attributed the fall of prices to decreased premium of fuel through the bulk procurement system (BPS) and appreciation of the local shilling by 0.34 per cent against the US dollar, despite increased oil prices in the world market.

"Premiums on petrol and diesel have decreased by US$ 45.36 (51.71 per cent) and US $13.94 16.13 (per cent) per tonne accordingly compared to premiums quoted during March and April," Mr Kaguo said.

With the new prices, consumers of the precious liquid in Dar es Salaam will buy a litre of petrol at 2,183/- compared to 2,231/- while a litre of diesel will cost 2,044/- compared to the old price of 2.098.

EWURA introduced pricing of fuel in 2009 by setting cap and indicative prices to protect consumers against artificial fluctuation of prices.The price of petrol in the world market has increased by US $1.58 (0.14 per cent) while the price for diesel decreased by US$ 27.03 (2.68 per cent) per tonne.

"This means that bulk procurement system has helped in stabilising prices in the local market as manifested by the decrease of pump prices," Mr Kaguo said.Cap prices on fuel announced by EWURA almost a moth ago on April 4, this year, showed that fuel prices had increased by an average of four per cent.

"The increase was slight since fuel prices in the world market increased by an average of 10 per cent, bulk procurement shelved the difference of 6 per cent," he elaborated.

Bulk procurement was introduced in January, this year, in a bid to increase transparency in the lucrative industry and enable the government collect appropriate taxes.

In another development, five oil depots in Mwanza and Arusha may face the wrath of the regulator since they pose health and environmental risks in surrounding areas. 

Mr Kaguo said inspection by EWURA on the depots has established that they were constructed below required health and environmental standards which make them detrimental to health of people and environment around them.

The depots include Mansoor Industries and Hass Petroleum in Mwanza as well as NSK Oil Limited, Gapco and Mount Meru in Arusha region."At present, two things are possible regarding the depots; they may either be decommissioned or suspended for sometime to be improved to the required standards", Mr Kaguo said.

Meanwhile, the regulator said it still awaits results of samples of petrol it sent to the Government Chief Chemist to assess whether it has been blended with ethanol as suspected by oil marketing firms.Responding to questions from journalists, Mr Kaguo said EWURA was yet to receive the test results from the government chemist.
Source: The Daily News, http://dailynews.co.tz, reported by Alvar Mwakyusa
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