Manmade fuel shortage disorients market

If the current shortage of petroleum is not resolved in the remaining few days, the Ministry of Trade and Regional Integration has stated that the market will be in disarray when the subsidies are applied starting from July 8, 2022.
In the past few days severe fuel shortage has pricked the country, including that of the Capital, Addis Ababa. However, the Ministry argues that the case is manmade.
“There is shortage of supply whilst demand is increasing,” said Tadesse Tilahun, CEO of the National Oil Company and President of Ethiopian Oil Companies Association adding that, “since there is shortage of supply we cannot provide petroleum in our stations which can cover the demand.”
“It is a manmade problem created by stations and sellers,” said Kumneger Ewnetu, Public Relation Director at the Ministry of Trade and Regional Integration, adding, “the government is importing fuel properly with no stated decrease on the amount, however, the main problem comes after it is shipped from Djibouti with trucks, which results it not to arrive to its allocated destination.”
“There is also lack of proper follow up of owners on trucks carrying petroleum,” explained Kumneger. The PR director also elaborated that the Ministry has also discussed the situation with the gas station owners and gave them warnings stating that if they don’t provide the service accordingly they stand a chance of facing high penalties including cancelation of licenses.
Hundreds of trucks carrying petroleum have been found in different parts of the country and some have been going to Sudan and Tigray whilst some are hording petroleum until the price adjustments are made.
“If all the stakeholders and the public work together we can have improvements and can minimize these effects,” Kumneger opined.
Apart from waiting on the price adjustments, petroleum has also been sold in the black market; to which around 400 million dollars’ worth of petroleum has been illegally smuggled from Ethiopia in 2020/21 according to reports. The contrasting prices with markets in neighboring countries have offered a lucrative prospect for profit through cross-border contraband trade, causing irregularities and disruptions in domestic fuel distribution.


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