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Thursday, June 20, 2024

Diesel shortage: Operators blame gov’t, minister explains

Diesel shortage: Operators blame gov't, minister explains

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By Omar Bah

The shortage of diesel fuel has been blamed on the government’s decision to “arbitrarily and drastically” reduce fuel prices. Drivers and commuters are calling on the authorities to urgently address the situation.

Speaking to The Standard, a manager in one of the country’s top petroleum companies who talked on the condition of anonymity said: “The diesel fuel shortage has been brought on by the government’s decision to force fuel prices on business owners. The government came with a new price regime which effectively replaced the existing one but usually when doing that they invite the concerned parties to a meeting where they table it and we decide on it together.”

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“They just sat among themselves and slashed prices here and there and came up with their own structure and later invited us to a meeting. During that meeting, the ministries of finance, petroleum and trade all came. We thought we were going to discuss but they just read a statement about the new price structure and left. They didn’t even bother to hear from us. They said that is what they have decided and that we should take it in good faith. We knew from the beginning that the government’s proposal was not reasonable.

“When we tabulated the figures we realised that if we sell at the new price we will be running at a loss but out of respect we all sell through August at a loss. In fact, some of the small petrol stations were on the verge of closing their stations but we struggled with them by giving them supplies just to make them survive until October.

“Now we have written to the government explaining to them the realistic prices at the world market for them to revise or reconsider their decision. They wrote to us after two weeks and invited us to a meeting with the ministry of petroleum. There we couldn’t agree on terms because the decision is purely political and this is why some of the businesses decided to dump their fuel at the depot [leading to the shortage at the pump stations],” our source added.

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The source claimed that 60 percent of profits generated from fuel sales goes to government coffers with only 40 percent going to the operators.

Government reacts

The minister of petroleum Fafa Sanyang confirmed to The Standard yesterday that the ministry of finance indeed proposed new pump prices which “have not gone well” with the operators. But periodic reviews of pump prices, he said, are normal procedures.

He said his ministry is engaging all the stakeholders in the industry to ensure that they come to terms and agree on a price that would be tenable.

“However before the new prices were announced the government invited all stakeholders to a meeting for us to discuss. During the meeting they extended their reservations about the proposed prices and we are engaging them,” he said. Sanyang said he understands that “people will link the shortage to the new prices”.

The minister however said: “When it comes to the shortage, fuel has been imported from Senegal and this afternoon some of the imported fuel will arrive. Some vessels are also coming and they will be here soon.”

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