Tigray Regional State is experiencing an acute fuel shortage that has impacted agriculture, disrupted businesses, and led to the rapid expansion of an illicit fuel market. Regional officials blame federal agencies for cutting off supplies, while the latter cite nationwide disruptions and technical failures at Djibouti port terminals.

Fuel scarcity in Tigray State has worsened over the past two months, forcing desperate businesses and farmers to resort to the parallel markets. Petrol prices on the illicit market surged to as high as 300 Br a litre, almost three times the official rate of 112 Br.

Gebremeskel Tareke, head of Tigray State's Trade & Export Agency, appealled in a letter to federal agencies, including the Ministry of Trade & Regional Integration (MoTRI), the Petroleum & Energy Authority (PEA), and the Ethiopian Petroleum Supply Enterprise (EPSE). He disclosed that fuel deliveries declined sharply starting in January 2025, reducing to two trucks before halting entirely by March 13.

"The region is in a deep crisis," said Kassahun Kindye, head of consumer protection at Tigray's Trade & Export Agency.

According to him, the region received about nine million litres of fuel monthly, despite an actual demand of approximately 13 million litres. Supplies plummeted to five million litres two months ago, and deliveries ceased entirely two weeks prior.

Kassahun criticised federal authorities for not responding adequately to the crisis, noting that the lack of fuel has effectively paralysed agriculture and businesses.

"The authorities have turned a blind eye on us," he told Fortune. "We don't want to be politically targeted. We only want to continue rebuilding."

The fuel shortage has brought broader economic disruptions, impacting transportation, healthcare, and agriculture. The Tigray Chamber of Commerce & Sectoral Associations (TCCSA), representing over 30,000 businesses, has repeatedly urged regional and federal authorities to resolve the crisis.

Berihu Haftu, president of the Chamber, portrayed a grim reality for the region’s economy, which was already struggling from the recent two-year civil war.

"The economy of Tigray hasn’t recovered," he said. "Many local businesses are now on the brink of collapse."

One such business, Selam Tranite Plc, which has been in business since 2006 and employs over 250 people, has faced severe operational setbacks. According to its General Manager, Gebrewahd Asfaw, the company relies heavily on diesel. Its four buses and two trucks are inactive due to fuel shortages, forcing the company to scale down production drastically. Production dropped nearly threefold, reducing its ceramic output to 650Sqm a day.

"We're on the brink of closure," Gebrewahd told Fortune.

The company had secured a 105 million Br loan a few months before the war erupted in November 2020. Accumulating interest has since inflated their debt close to 200 million Br. Efforts to secure an additional 150 million Br loan remain pending, further complicating the company's financial predicament.

Despite the federal government's recent removal of fuel subsidies and pricing reforms targeting efficiency, Tigray State continues to face chronic shortages.

Last week, Trade Minister Kassahun Goffe (PhD) increased petrol prices to 112 Br a litre, nearly a 10pc rise. Diesel now costs 109 Br a litre. Influenced by global market pressures, currency depreciation, and subsidy removal, the hikes sparked sharp criticism from consumers across urban areas.

Federal authorities have recognised the concerns raised by Tigray State officials.

Tesfaye Abo, head of commodity price monitoring at MoTRI, confirmed they had received alarming reports about severe drops in benzene and diesel supplies. He disclosed that his office promptly communicated these concerns to the Petroleum & Energy Authority for immediate action. However, the Authority claimed it was unaware of the severity of the issue until recently.

According to Dibira Fufa, the Authority’s deputy general director, investigations began promptly after they received formal notice. Despite recognising the deficit, Dibira noted ongoing regulatory reviews to resolve the issue.