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Tempers frayed over fuel
Published in The Egyptian Gazette on 18 - 06 - 2013

CAIRO - A renewed fuel shortage, which has hit Egypt over the past few days, has turned the country's roads into a clogged, chaotic garage. Queues of vehicles of different types and sizes stretch in front of petrol stations for hours, waiting for diesel fuel and petrol amid frequent brawls among their fuming drivers.
Although the government has recently started implementing a system based on distributing petrol through using smart cards in some governorates of the country, the problem is worsening.
To make up for their financial losses resulting from queuing up for long hours at petrol stations, owners of minibuses and taxis have raised their fares, infuriating their clients who complain about the soaring costs of living.
Minister of Petroleum and Mineral Resources, Sharif Haddara, has said that his ministry had pumped additional supplies of petrol and diesel so as to ease the crisis.
"An average 37,000 tonnes of diesel fuel are being pumped on a daily basis, a quantity seven per cent higher than the usual," he added. He said that 18,100 tonnes of petrol are being pumped daily, a 20 per cent increase compared to the usual supply
He denied there is a fuel shortage. "There is a kind of imbalance in the distribution system that will be redressed by co-ordinating with various authorities in the country."
He noted that Petroleum and Finance Ministries have repeatedly made it clear that the smart cards system does not set fuel quotas per car.
"The main goal of this system is to monitor distribution to specify the number of the people who actually deserve the state-subsidised fuel."
Other officials have attributed the shortage to smuggling activities and hoarding fuel. The official explanations have not allayed motorists' anger.
"I spent three hours looking for a station that sells the 92-octane petrol," said Hassan Selim, an employee at a bank "I find one station far from my house. I joined a snake-like queue for more than an hour. When my turn came, I was surprised to be told that there was no 92-octane petrol any more. So I had to buy the 95-octane petrol, which cost me, twice higher than the 92 octane."
Mohamed, an owner of a travel company, is feeling the pinch too. "Every day, I send one of the company's buses to queue up for fuel and then distribute the amount to the rest of the buses."
Mohamed el-Naggar, a taxi driver, grouses that the fuel crisis is getting so worse that it seriously affects their earnings.
"Passengers do not care of the psychological and financial pressure on us. They get angry if we slightly raise the fare," el-Naggar says, pointing out that he is "saddled with" paying monthly installments for his taxi.
He claims that owners of petrol stations stand behind the crisis, allegedly to sell fuel on the black market.
As for the application of the smart cards system, el-Naggar suggests that there must be a maximum quota for each car, depending on its engine capacity and the owner's actual needs.
Sayyed Magdi, a driver of a privately operated microbus, says he queues up for at least three hours everyday to refuel his vehicle.
"Microbus drivers do not depend on the smart cards system because it is still in the beginning and limited only to Cairo and Giza. The problem is worse in other governorates," he argues.
"A 20-litre jerry can of diesel sells for LE40 on the black market, that's two times higher than its official price," says Saber, a driver who admits to having blocked a road outside a petrol station in protest.
"The fuel is abundantly available on the black market and is sold in broad daylight for those who can afford it," he fumes.
"We haven't seen a crisis like this before," Yassine Khalil, a 55-year-old microbus driver, said. "The People are asleep in their homes and we are waiting to refuel."
The problem is the latest to befall Egypt whose total budget deficit recorded 10.6 per cent of the country's gross domestic product (GDP) in the first 10 months of the 2012/13 fiscal year, according to the Finance Ministry.
A report issued by the investment bank HC found out that the decades-long subsidy system makes it hard for the Egyptian government to cut subsidies, a matter that exacerbates the country's budgetary deficit.
Egypt is seeking to reduce the deficit to reach 9.5 per cent of GDP by the next fiscal year.
Osama Kamal, the former Minister of Petroleum, believes that the reason for the current fuel crisis lies in failure to properly distribute the market supply.
"Egypt needs to take a break from politics for a year, and to look at the country's supreme interests," he told the Qatari broadcaster Al-Jazeera Mubasher Misr TV.
President Mohamed Morsi and the opposition have been locked for months in a deep political dispute, which occasionally erupted into street violence.
"Egypt is using only 5 per cent of its mineral wealth. We are one of the largest countries that have refineries," Kamal said.
The ex-official also told the Egyptian private TV station Al-Hayat that energy subsidies in Egypt hit LE115 billion in 2011-2012 and predicted it to reach LE120 billion annually in the coming years.
Egypt is struggling to get a 4.8 billion loan from the International Monetary Fund to plug the runaway budgetary deficit. It is not clear yet when a relevant agreement will be signed amid mounting political tensions in the country.

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