By Joseph Kiggundu
Kampala, Uganda
Barely a year after taking on the mandate to import all of Uganda’s petroleum products, the Uganda National Oil Company (UNOC) has achieved what many once thought impossible — stable fuel prices, consistent national supply, and record profits.
In an exclusive interview with Daily Monitor, Proscovia Nabbanja, Chief Executive Officer of UNOC, shared insights into how the company turned a controversial policy shift into one of Uganda’s most successful government-led reforms.
A Year of Milestones
Since the Petroleum Supply (Amendment) Act, 2023 came into effect, UNOC has supplied more than 3.6 billion litres of petroleum products and generated an estimated USD 150 million in gross margin.
“Our success has been driven by deliberate collaboration,” Nabbanja said. “Right from the policy change, we received tremendous support from His Excellency the President, the Ministry of Energy, the Ministry of Finance, Parliament, and the Government at large.”
Under a five-year supply agreement with Vitol Bahrain EC, UNOC now imports fuel directly into the country without letters of credit or government guarantees a major shift from the decades-old system where private oil marketing companies relied on Kenyan middlemen.
“We are averaging about 240 million litres per month across petrol, diesel, and jet fuel,” Nabbanja explained. “Our partnership with Vitol has been instrumental — they’ve consistently delivered the volumes needed to meet national demand.”
Keeping Prices Stable and Fair
Uganda’s motorists have enjoyed rare price stability since the new system began. Between late 2024 and early 2025, diesel prices averaged between UGX 4,334–4,750 and petrol between UGX 4,608–4,990, a dramatic reduction from highs of UGX 6,500 per litre before UNOC’s intervention.
According to Nabbanja, this has been achieved through transparent pricing and operational efficiency.
“Every Oil Marketing Company that signs a sale and purchase agreement with UNOC gets the same price,” she said. “This has encouraged fair competition and eliminated speculation, which used to drive pump prices up.”
She added that under the previous regime, OMCs faced additional and unpredictable charges such as demurrage. “UNOC offers one price — no future surprises. This has restored confidence and stability in the market.”
Economic Ripple Effects
The new importation model has also helped strengthen the Uganda shilling, now trading between UGX 3,400 and 3,500 per USD, and reduced imported inflation.
Previously, Ugandan OMCs had to secure U.S. dollars monthly to pay middlemen, putting pressure on the local currency. “Now, those hundreds of millions remain in-country, supporting our economy instead of enriching foreign banks,” Nabbanja noted.
According to Uganda Revenue Authority (URA) figures, fuel tax revenues have also grown. Diesel import taxes rose from UGX 128.9 billion in January 2024 to UGX 129.6 billion in January 2025, while petrol import tax revenues increased from UGX 178.4 billion to UGX 181.7 billion over the same period.
Overcoming Early Challenges
UNOC’s implementation was not without obstacles. Kenya’s initial refusal to license UNOC to use its pipeline infrastructure led to tensions that were only resolved through presidential diplomacy.
“The transition was never expected to be easy,” Nabbanja acknowledged. “But through planning, regional engagement, and collaboration, we navigated those diplomatic and logistical hurdles. The two heads of state were very supportive.”
She emphasized that UNOC continues to work with regional partners in Kenya and Tanzania to ensure shared benefits and fair access to infrastructure. “We’ve learned that regional energy cooperation must be based on mutual understanding and long-term integration.”
Building Capacity and Talent
Critics had initially doubted UNOC’s capacity to manage nationwide fuel importation. Nabbanja says that strong governance, training, and investment in human capital have been the company’s greatest assets.
“We’ve been intentional about attracting top talent and exposing our staff to complex operations,” she said. “We’ve also learned from other national oil companies and industry majors that have offered to support UNOC in building competencies.”
UNOC’s risk management framework, she added, has been vital in securing smooth operations, diversifying supply routes, and expanding in-country storage capacity to maintain buffer stocks.
Looking to the Future
Asked whether UNOC plans to replicate this model in other areas, Nabbanja said the company’s long-term vision is to build a vertically integrated and financially independent national oil company.
“Our short- and medium-term focus is to commission projects that will enhance revenue generation and sustainability,” she said. “UNOC is already involved in Tilenga and Kingfisher upstream projects, the Refinery Project, the East African Crude Oil Pipeline, and storage terminals in Jinja and Kampala.”
The company is also exploring new ventures in LPG supply, petrochemical industries, biofuels, and regional pipeline developments in Kenya and Tanzania.
“LPG will act as a transitional fuel to reduce dependence on biomass,” Nabbanja explained. “We’re also planning a Kampala–Eldoret pipeline with reverse-flow capability to strengthen regional trade.”
“We Are Building Value for Generations”
Reflecting on UNOC’s journey, Nabbanja credited political will, professionalism, and teamwork for the transformation of Uganda’s fuel sector.
“At UNOC, we first envision what success looks like and then work meticulously to achieve it,” she said. “For us, success means ensuring competitive prices, supply security, and revenue that supports the national treasury.”
Asked about the broader lessons from this experience, Nabbanja said:
“This model shows that with discipline, transparency, and strong partnerships, Uganda can unlock its full potential. We are creating value not just for today, but for generations to come.”
End