Diesel crunch sweeps Egyptian provinces

Ahram Online , Sunday 15 May 2011

Shortage is affecting public transport, trade and food supplies, hiking prices and prompting government to speed up its energy imports


It started with a diesel black market, established when farmers couldn’t find state-subsidised supplies at local petrol stations to power their machinery and harvest crops.

By Sunday, public microbus drivers couldn't fill their tanks and many governorates were witnessing a complete paralysis of transport affecting both goods and people. Long lines of microbuses were seen at more than one petrol station in Cairo. The crisis was most apparent in Egypt’s four northern governorates.

Egypt imports most of diesel, buying it at world market prices and reselling it to Egyptians at less than 40 per cent of the cost. The difference is estimated to cost the government some LE20 billion, or almost a third of the sum budgeted for energy subsidies.

The crunch has also hit Egypt’s fishermen who are unable to fill their boats, leading to a hike in fish prices. The wheat harvest has also stalled for want of diesel to run agricultural vehicles.

A statement from the public authority for petrol on Sunday announced that it imported 140,000 tonnes of diesel, of which 35,000 have already arrived at an unnamed Egyptian port. The rest is expected to arrive within the next week.

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