Muhongo calls for long term measures for stable fuel supply
A RENOWNED geologist and politician, Professor Sospeter Muhongo has called for detailed exploration and investment on petroleum and gas as a long-term measure for the country to have stable fuel supply.
He made the remark in an interview with the ‘Sunday News’ recently, while commenting on the newly petroleum products price cap released by the Energy and Water Utility Regulatory Authority (EWURA) which indicate slight increase in the price.
The increase in prices is attributed to among others increase in the world market price by up to 21 per cent and increase in premiums for importations up to 62 per cent.
Prof Muhongo who is also Musoma Rural Member of Parliament (MP) said exploration on petroleum deposits will enable the country to scale up investment on refining fuel resources available in order to create fuel self-sufficiency for the country’s vehicles and the energy sector at large.
He said to date major oil producing countries including the Organisation of Oil Producing Countries (OPEC+) and Russia have been cutting oil pro- duction to increase demand to the oil importing countries that bring an upward trend of oil prices.
“The oil producing countries are struggling to boost their respective economic growth and cut down inflations, the most plausible undertaking for them is cutting down oil production to bring about high prices of their oil” Prof Muhongo said.
According to him, for instance Russia will extend its production cut of 50,000 barrels per day until the end of this year hinting that globally oil price will keep on increasing until the end of this year and may go up to 2024.
Additionally, he said the country has opportunities to speed up the transition to alternative energy to attain a gas economy which can reduce fuel dependence.
An Economist, Dr Isaac Safari based at the Saint Augustine University of Tanzania (SAUT) said the cut in production by the major oil producing countries results into decrease in value of Tanzania Shilling against the hard currency such as dollar.
He said the country can add value to the shilling by scaling up production and value addition to have competitive advantages that spur export and attract more dollars to enable importation of petroleum products which will be sold at affordable price.
