Sh20bn extra in fuel tender raises queries

What you need to know:

Fuel consumers should brace for tougher times when the Energy and Water Utilities Authority announces new indicative prices for petroleum products, thanks to the amplified premium in the new importation contract.

Ewura reacted to a public outcry by slashing pump prices late last year. In February, Ewura capped the price for petrol at Sh1,768 per litre in Dar es Salaam while diesel was capped at Sh1,708. Tanzanians rejoiced further in March when the price of petrol dropped further to Sh1,652 while that of diesel was Sh1,563. With a falling local currency, Ewura started reviewing prices upwards. In January last year, the Shilling traded at an average of 1,630 against the dollar. In February this year, it was trading at between Sh1,830 and Sh1,900 per dollar before depreciating to a historic Sh2,400 in June, sending the Bank of Tanzania back to the drawing board--which saw the Shilling bounce back to hover around the Sh1,900 mark in early July 2015. It stands now at an average of Sh2,150. Hand picking of one company to supply petroleum products sends bad signals to PIC, which has always claimed that the BPS programme, which is meant to be implemented through the common open tenders system, has helped reduce the cost of importing petroleum products in the past two years to reach premiums as low as $37.33 per metric tonne. Bringing the premium to $64.911 means that the country is now hovering close to the pre-BPS period, when the cost rose as high as $73 or more per metric tonne.

Sh20bn extra in fuel tender raises queries

What you need to know:

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