An evaluation of the petroleum products’ pricing efficiency and its regulation’s effectiveness in the Tanzanian downstream petroleum sector

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Date
2010
Journal Title
Journal ISSN
Volume Title
Publisher
University of Dar es Salaam
Abstract
This study was carried to establish whether there is efficiency in petroleum products’ pricing and regulation in the downstream petroleum sub-sector, focusing on pricing strategies and core drivers. An exploratory study was selected for this research as it provides room for understanding the context of the research and changing the methodology where necessary. Data were collected by using primary and secondary data and tested using correlation analysis and Analysis of Variance (ANOVA) both at 0.05 levels of significance. The findings have revealed that the pump prices movement follows the general international prices trend and the costs incurred in bringing the products to saleable state. It was noted that international exchange rates movements has a direct impact on Platts prices, and hence movements in Platts prices are partially a reflection of international exchange rates movement. Regulation of petroleum sector by Energy and water regulatory authority (EWURA) is reasonably effective as the results shows that Oil Marketing Companies (OMCs) abide to indicative/cap prices set.From these findings, it is recommended that, Oil marketing companies to improve on costs management in procuring their products and also push the government on Bulk procurement for better bargaining power. EWURA needs to review their pricing build up formula frequently. The government has a role to play in improving petroleum price levels for example by widening tax base hence relieving petrol products and amending applicable laws to empower EWURA especially on data collection from OMCs. In general OMCs have to manage their costs in order to be able to sell at lower prices.
Description
Available in print
Keywords
Petroleum products, Prices, Tanzania
Citation
Kasilima, H.(2010) An evaluation of the petroleum products’ pricing efficiency and its regulation’s effectiveness in the Tanzanian downstream petroleum sector.Master dissertation, University of Dar es Salaam. Available at http://41.86.178.3/internetserver3.1.2/search.aspx