There are claims from a legislator in the Tanzanian National Assembly that some unnamed oil tanker ships are anchored at deep sea, peddling oil cheaply, despite current increase of oil prices globally.
Ahmed Shabiby, the Member of Parliament representing Gairo Constituency of Morogoro, said with some countries being sanctioned, a number of their ships continue with oil trading clandestinely at deep seas.
Shabiby, who is also a businessman, running fleets of buses as well as gas stations, was trying to explain why it was important for oil dealers to be allowed to individually import petroleum products.
BPS savior or devil?
At the moment, Tanzania orders crude oil on state-supported Bulk Procurement Systems.
“The only way to keep fuel prices down, despite the Eastern Europe conflicts and related global sanctioning, is by allowing competition among importers,” Shabiby maintained.
As far as the legislator is concerned, once entities are allowed to import fuel on their own, each will find ways of procuring consignment of such, including outsourcing it from the deep sea tankers selling the commodity on the cheap.
“Besides, the best way to keep fuel prices low is through competition, bulk procurement stiffles competition and leaves no room for pricing flexibility,” argued Shabiby.
Tanzania’s Bulk Procurement System (BPS), aims to cut fuel pump prices through competitive international tenders
But 85 percent of BPS tenders in 2019/2020 were awarded to just 3 companies; Sahara Energy Resources with a 33 percent lion share, Total Oil Trading with 27 percent and Addax Energy 25 percent.
Now Shabiby says there is corruption in country’s fuel Bulk Procurement System (BPS) and sabotage of oil flow meters at Dar es Salaam port
“Prices will decline if traders are allowed to import fuel outside BPS”
Another Member of Parliament, Hamisi Tabasamu, questions the state-run Petroleum Bulk Procurement Agency over award of fuel import tenders, urging President Samia Suluhu Hassan to urgently intervene.
Conflicts of Interest?
From the Tanzania Business Inside Twitter page, it was writted that several Tanzanian Members of Parliament, including former Speaker Job Ndugai, Ahmed Shabiby and Hamisi Tabasamu own gas stations.
Both MPs Ahmed Shabiby and Hamisi Tabasamu, have criticized bulk petroleum imports, with observers saying they do so because of having personal or family links to fuel oriented businesses.