Vivo Explains Fuel Prices

Vivo Energy Uganda Managing Director Hans Paulsen has said there were many costs companies incurred before selling fuel, most of which are passed on to the consumer at the pump station.

“There’s a combination of many factors for fuel prices to go up in Uganda. The costs of transportation, refinery, the exchange rate and taxes will increase fuel prices. In case taxes on fuel are increased in the next financial year as I have read in the papers, the pump price will go up,” he said.

Paulsen was speaking to journalists during a media breakfast at Serena hotel Kampala recently. He said while global crude oil prices may have come down,

it may not be reflected at the pump stations here right away.

Uganda uses about 110 million litres of fuel every month and Vivo Energy supplies 30 million.

“Vivo Energy, the dealers of Shell-branded products, controls between 28 to 30 per cent of the market share. All fuel dealers purchase fuel through an Open Tender System from Nakuru, Eldoret or Kisumu in Kenya. The system is controlled by the energy ministries of both Uganda and Kenya,” Paulsen said.

Vivo Energy also transports its Shell V-power, Shell gas, lubricants and heavy fuel oil (HFO) by road from Mombasa, while the bulk of its products are imported by pipeline and rail.

“The most ideal fuel transportation system is an oil pipeline, followed by rail. But since railways still don’t have enough train wagons, Vivo Energy uses trucks to

import fuel into Uganda daily,” Paulsen said.

Paulsen said in order to keep customers using Shell FuelSave Unleaded and Shell FuelSave diesel, Vivo Energy has plants that add special chemicals to the standard. He said about 20 per cent fuel on the Ugandan market is adulterated.

Joseph Adrapi, the Vivo Energy quality manager, said Vivo had a modern laboratory, which tested and certified the quality of fuel at their filling stations and fuel trucks. Edward Walugembe, the Vivo Energy country sales manager, said the prices of fuel differ in different places due to the demand and supply around the area.

Source : The Observer

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