Tanzania: Survey Shows Decrease in Fuel Prices

Text of report by Gadiosa Lamtey entitled “Fuel prices start falling” published by Tanzanian newspaper The Guardian website on 30 August

Fuel prices in Tanzania have fallen for the first time in months, raising hopes that consumer goods and services would respond accordingly, The Guardian has established. The prices have over the last few months been skyrocketing, making those of foodstuffs, consumer goods and other commodities also shoot up.

A week-long survey conducted by this paper in Dar es Salaam has found prices of almost all types of oil displayed at below 2,000 shillings [about 1.72 dollars] a litre.

Displays at various filling stations in the city’s central business district and suburbs reflect an average price drop of over 12 per cent in only four weeks.

Oil dealers, authorities and experts have attributed the dramatic price fall mainly to a decline in global prices.

In the first week of August, different types of petroleum products were selling at between 2,025 shillings [1.75 dollars] and 2,045 shillings [1.76 dollars]a litre but are now as low as 1,920 shillings [1.65 dollars].

Kinondoni BP filling station manager Rashid Mangirile predicted during an interview that the prices of oil products could drop even further by October.

“They are sure to fall to their previous levels. We hope this will please our customers,” he said, adding: “I also hope that prices of foodstuffs and other commodities will go back to normal, especially during the coming holy month of Ramadhan.”

At one Gapco filling station, diesel was selling at 1,980 shillings [1.71 dollars], petrol 1,700 shillings [1.5 dollars] and kerosene at 1,480 shillings [1.3 dollars] a litre.

The responding prices for the first two items at most Oilcom fuel stations were 1,920 shillings [1.7 dollars] and 1,660 shillings [1.4 dollars].

Meanwhile, a source at a Big Bon filling station who preferred strict anonymity said importers sold fuel the way other oil companies did.

Commenting on the downward trend of oil prices, Energy and Water Utilities Regulatory Authority (Ewura) Director-General Haruna Masebu said local market prices had been affected by world market forces.

He said most local dealers would normally reduce or increase prices in line with international market trends.

Masebu explained that Tanzania was a net importer of petroleum products and had a limited number of options for cushioning the impact of the trend.

Dr Kassim Kulindwa, a senior research fellow with the University of Dar es Salaam’s Economic Research Bureau, said the price drop was due to decreased demand for oil.

An agency source quoting OPEC data showed yesterday that crude oil prices stood at around an average of 102 dollars a barrel, down from a record 147 dollars in Saudi Arabia, the world’s largest oil producer.

Soaring fuel prices pushed Tanzania`s annual inflation further to 9.3 per cent in June from 9.1 per cent the previous month, according to the National Bureau of Statistics.

“The rise in inflation is attributed to the increase of petrol, diesel, kerosene and charcoal prices,” said the bureau in a recent statement, adding that food inflation also rose though only slightly.

Food carries a weight of 55.9 per cent in Tanzania’s basket of goods used to measure inflation.

Tanzania imports all its petrochemical products and soaring prices on the international market have bitten deep into its economy, experts say.

Originally published by The Guardian website, Dar es Salaam, in English 30 Aug 08.

(c) 2008 BBC Monitoring Africa. Provided by ProQuest LLC. All rights Reserved.