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S.Africa strike bites, some gas stations run dry

South Africa is on the brink as thousands of oil workers go on strike over poor pay

Reuters, Thursday 14 Jul 2011
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Scores of petrol stations in South Africa have run out of fuel, an industry spokesman said on Thursday, as a strike by workers in the oil sector escalates.

The Solidarity union, which represents about 6,000 skilled workers, on Thursday joined the strike by about 70,000 workers mainly from the Chemical, Energy, Paper, Printing, Wood and Allied Workers Union.

CEPPWAWU members in the petroleum, chemical and pharmaceutical industries stopped work on Monday, demanding 13 percent wage increases, about triple the inflation rate, and above the 4 to 7 percent offered by employers. Other, smaller unions have also joined the strike this week.

Most fuel shortages were recorded in Gauteng province, the country's economic hub which includes its biggest city Johannesburg.

The Fuel Retailers Association said more than 150 service stations in Gauteng had run dry by close of business on Wednesday and the situation was worsened by panic buying as people rushed to the pumps to secure some fuel.

"The situation is worsening and if we don't manage it properly, we might end up with a crisis next week," said Reggie Sibiya, the FRA's chief executive officer, adding that all contingency measures put in place by the oil companies were being undermined by the industrial strike.

Unions and employers in Africa's biggest economy are in their mid-year bargaining session known as "strike season", with many labour groups seeking wage increases that far exceed inflation.

"There is no product coming out of the key main depots... and the employers and the unions are not coming to some kind of resolution so the strike is indefinite as we speak," Sibiya said.

The CEPPWAWU has said the strike will definitely run into next week.

Employers in the sector include BP Plc, Royal Dutch Shell, petrochemicals group Sasol, state-owned energy group PetroSA, Chevron and Total.

Central bank and Treasury officials have said high wage increases threaten the outlook for inflation and the long-term prospects for the economy.

A strike in the steel and engineering sector entered its second week on Monday, with the industry expecting substantial production and financial losses.

Possible strikes also loom in South Africa's crucial platinum, coal and gold industries

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