Uganda has adequate fuel stocks, but rising pump prices reflect the country's dependence on imported petroleum and exposure to external shocks, according to Pan African Global Business chairman Captain Mike Mukulu. The shilling has weakened significantly against the dollar, moving from around Shs3,700 to approximately Shs4,100, increasing the local-currency cost of purchasing fuel from international suppliers. Global oil prices have also risen due to strong demand and supply disruptions linked to the Russia-Ukraine war and attacks on Russian oil infrastructure.
For Ugandan motorists and businesses, the combination of currency weakness and volatile international oil prices means fuel costs remain unpredictable. Even if global oil prices fall, pump prices may not drop immediately if the shilling stays weak or other import and distribution costs remain high. President Museveni, speaking during Uganda's 64th Independence Day celebrations on October 9, said the government would not use foreign exchange reserves to stabilize the currency, instead urging Ugandans to consume locally made products to reduce exposure to dollar fluctuations.
Mukulu expressed hope that diplomatic discussions between United States and Russian leaders over oil prices could ease pressure on fuel-importing nations like Uganda. The immediate challenge for policymakers is reducing Uganda's vulnerability to external price shocks and limiting fuel costs' effects on transport fares, goods movement and household budgets.