Oil prices have staggered between $75 (Rwf44,047) and $80 (Rwf46,984) per barrel for about a year leading to fluctuation in local pump prices. This according to officials caused the country to experience its first ever highest fuel price tag.
As a result, the government is set to construct a huge storage facility so as to have control of the local pump prices just in case of international prices hike like early this week.
According to the Permanent Secretary in the Ministry of Trade and Industry, Emmanuel Hategeka, government is working-out a strategy where petroleum products will be purchased in bulk.
“We don’t decide the trend of international oil prices, so we depend on the international trend-but the government’s intension is to always stabilise the price so as not to destabilise the market,” Hategeka said.
At the beginning of the month, fuel prices for premium super fell from Rwf940 to Rwf925 per litre while diesel fell from Rwf940 to Rwf917, which was attributed to the continued drop in oil prices on the international market.
However, less than two weeks down the road, oil prices on the international market are rising again.
On July 5th a barrel was trading at $71 (Rwf41,698), July 12th $74 (Rwf43, 460), currently barrel is trading $77 (Rwf45,222).
Hategeka also said that fuel is a sensitive product which is regulated. “Thats why we (Government) meets with petroleum dealers and review the behaviour of the trend on the international market,” he said.
In May, pump prices increased from Rwf918 to Rwf940 for both petrol and diesel per litre being the first highest pump price the country has ever experienced. The increase was attributed to the hike of a barrel on the international market from $70 (Rwf40,880)to $89 (Rwf51,709)
Experts have predicted that given the strength of the fundamentals, a barrel is likely to increase as above as $80 a barrel.