Editorial: End Uganda’s fuel shocks

Why should a war thousands of kilometres away so quickly become a crisis at a Ugandan fuel pump?

That question is so painfully familiar. International conflicts disrupt oil markets and supply routes, and Ugandan motorists and businesses are quickly reminded how exposed the country remains.

Pump prices rise, transport becomes more expensive, and those costs eventually work their way into almost everything else. Uganda cannot control wars abroad. It can control how prepared it is when they happen.

That is why President Yoweri Museveni’s planned $300 million Kampala Storage Terminal deserves to be judged as more than another oil infrastructure project. Uganda consumes about 240 million litres of fuel each month.

The proposed Namwabula terminal in Mpigi will hold 320 million litres, more than 10 times the capacity of the existing 30-million-litre Jinja terminal and more than the country’s current monthly consumption.

That is potentially transformative. But storage capacity and fuel security are not the same thing. Tanks protect a country only when they contain adequate reserves, are replenished intelligently and form part of a functioning national energysecurity strategy.

Uganda, therefore, needs more than concrete, pipelines and ceremonial groundbreakings. It needs clear rules governing strategic reserves: how much fuel must always be available, who pays for it, who controls its release and under what circumstances stocks can be drawn down.

The proposed terminal offers a chance to build that discipline. It is expected to store imported petroleum products as well as fuel eventually produced by Uganda’s planned Kabaale refinery. UNOC intends to retain a 51 per cent stake while bringing in a joint-venture partner.

That structure makes transparency essential. A $300 million strategic asset must not become merely a large commercial warehouse. Government should tell citizens what proportion of its capacity will constitute genuine emergency reserves and how those stocks will protect the economy during prolonged disruptions.

Museveni’s larger argument is that domestic refining can reduce Uganda’s vulnerability to imported petroleum products.

“When we refine our oil here, you don’t pay transit charges,” he said on September 2.

The logic is compelling, but Uganda must now turn that logic into an integrated system. The country is preparing to export its first crude, expected in early 2027, while planning a 60,000-barrel-a-day refinery, a 211-kilometre products pipeline and the Kampala storage terminal.

These projects should work together rather than become expensive islands. Uganda also needs diversified import routes and suppliers, transparent monitoring of national stocks, stronger competition throughout the fuel market and contingency plans that can be activated before international disruption becomes domestic panic.

No storage terminal can insulate Uganda completely from global oil prices. A country that imports petroleum products will remain exposed to international markets. But vulnerability is not helplessness

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