Tanzania’s petroleum market is at an inflection point. Petroleum imports are rising, while domestic demand continues to grow over the long term.
However, demand is not distributed equally across the country. This means the commercial potential of a petrol station project depends heavily on where the station is located within the market.
Petrol station projects require substantial capital, making capital risk, regulatory compliance and financing approval important considerations for investors.
Research also indicates that location can determine a significant share of a petrol station’s sales volume. This means that selecting the right location is critical to generating sufficient sales volume, protecting invested capital and achieving an acceptable return on investment.
Tanzania Has Growing Demand for Petroleum Products.
EWURA’s latest Mid and Downstream Petroleum Sub-Sector Performance Report for FY2024/25, published in July 2026, shows that Tanzania’s petroleum demand has followed a long-term upward trajectory.
Historical data from 2019 to 2025 indicate an average annual growth rate of about 6%.The report also shows that Tanzania consumed 5.12 billion litres of petroleum products in 2024/25, up 10.3% from 4.64 billion litres in 2023/24.
Diesel accounted for approximately 2.82 billion litres, while petrol consumption reached approximately 2.01 billion litres. The retail network, including petrol stations, which is heavily linked to road transport, accounted for 3.16 billion litres, equivalent to 61.8% of total petroleum consumption.
Therefore, the more useful question for a petrol station investor is not simply:
Is there demand for petroleum products in Tanzania? The better question is:
Which region—and more importantly, which specific location—offers the potential to generate sufficient sales volume to support an attractive return on investment?
Fuel Consumption Is Concentrated in Particular Regions.
EWURA’s downstream petroleum data show significant differences in petroleum consumption between regions.
The regions with the highest recorded consumption include Dar es Salaam, Mwanza, Pwani, Arusha, Dodoma, Mbeya, Tanga, Kilimanjaro, Morogoro and Shinyanga.
Dar es Salaam recorded the highest consumption, with approximately 1.6 billion litres of petroleum products consumed through retail outlets and consumer installations in 2024/25. This represented approximately 34.4% of total petroleum product consumption across the regions.
Mwanza followed with approximately 335 million litres of petrol, diesel and kerosene consumption, representing about 7.1% of the total. Pwani recorded approximately 255 million litres, equivalent to about 5.4%. Arusha recorded approximately 240 million litres, representing about 5.1%.
Dodoma recorded approximately 236 million litres, representing about 5.0%. Mbeya recorded approximately 207 million litres, also representing about 4.4%. Tanga recorded approximately 153 million litres, equivalent to about 3.3%. Kilimanjaro recorded approximately 149.8 million litres, representing about 3.2%.
Morogoro recorded approximately 147.9 million litres, representing about 3.1%. Shinyanga recorded approximately 149.8 million litres, representing about 3.2%.
High Fuel Consumption in a Region Does Not Automatically Make Every Site Attractive.
These figures allow investors to draw an important conclusion.Tanzania imported approximately 10.66 billion litres of petroleum products in 2024/25, while domestic petroleum consumption reached approximately 5.12 billion litres. Retail networks, including petrol stations, accounted for 61.8% of total petroleum consumption.
However, petroleum demand is not distributed equally across regions—and regional demand does not mean that every potential petrol station site within that region will be commercially viable.
A region can have high overall fuel consumption while an individual location within that region may face strong competition, insufficient traffic, poor accessibility, limited visibility or an inadequate trading area.
For this reason, investors should not assume that high regional fuel consumption automatically guarantees a successful petrol station project.
The Real Investment Question Is the Specific Location.
A proper feasibility assessment should determine whether the specific proposed site can generate sufficient sales volume to support the required investment.
This should include an assessment of:
- – Traffic volume and traffic patterns
- – Expected sales volume within the trading area
- – Transport and vehicle profile
- – Competitor locations and market share
- – Site visibility
- – Accessibility and road connectivity
- – Existing and planned competing stations
- – Local commercial and economic activity
- – Petroleum demand within the catchment area
- – Capital requirements and operating costs
- – Projected cash flow, ROI, IRR and payback period
The objective is not simply to identify a region with high fuel consumption.
The objective is to determine whether your specific site can capture enough demand to make the project commercially viable and financially sustainable.
Planning a Petrol Station Project in Tanzania?
If you are planning to develop a new petrol station in Tanzania, a bankable petrol station feasibility study can help determine whether your proposed location and project are commercially viable, financially sustainable and aligned with Tanzania’s regulatory requirements.
Before committing substantial capital, understand the market, test the location and establish the financial viability of the project.
Contact us at +255 (0)655 376 543 or Hussein.boffu@tanzaniapetroleum.com.
