FORTUNE+ VIDEO SPONSORED CONTENTS ADVERTORIALS FORTUNE AUDIO Fortune Careers New TRADE AFRICA New

Fortune Logo

It is that time of the year again. Fuel stations in Addis Abeba see a queue of cars hundreds of metres long, lining up for a refill. The only stations spared would be those that have exhausted their stock and closed until fuel trucks arrive to supply them. Over the past two weeks, this has been the case with a line of vehicles snaking up the capital’s streets; drivers are waiting for hours before they are served at the pumps. Why is there a fuel shortage?


No one can conclusively say. In the past, Addis Abeba faced shortages for a variety of reasons. It could be speculative filing up of tanks or political instability that clogs supply routes. A bit of the former could be adding to the problem now. In the past, vehicle owners anticipating a price hike tried to soak up as much fuel in their tanks as possible before the month was out. But what created the shortage from speculation is hoarding by businesses along the fuel supply chain. If they smell a price increase coming, shortages are bound to happen. The last time this happened was in January and February of last year when the lines at fuel stations disappeared after the authorities announced that the retail price would not change.


Speculation could be at play this time around following retail price adjustments last December as federal authorities found it hard to bear subsidies. More bad news followed when a plan to lift subsidies entirely was announced the following month. The speculation could result from confusion; the move away from subsidies is supposed to be gradual, beginning in July with variations between public transport providers and everyone else. But that cannot be the whole story. There is also drama brewing along the fuel supply chain as fuel transporters, and the authorities lock horns over tariffs. The federal government sets a flat fee for transporting fuel from ports in Djibouti. But truck owners see their margins dwindle as maintenance and service charges grow, leading them to demand higher costs. Some 40pc of fuel truckers are said to be out of action. Until these issues are addressed, the lines are not going anywhere. There is no indication that they are well understood.



You can read the full story    here    


PUBLISHED ON Feb 12,2022 [ VOL 22 , NO 1137]

[ratemypost]


Related Posts

[ssba-buttons]

Put your comments here

N.B: A submit button will appear once you fill out all the required fields.

Editors' Pick

Exclusive Interviews

State Enterprises from Oracles to Apprentices

Dec 22 , 2024 . By TIZITA SHEWAFERAW

Charged with transforming colossal state-owned enterprises into modern and competitiv...

Agenda

Rising Costs, Inflation Threaten Insurance Industry

Aug 18 , 2024 . By AKSAH ITALO

Although predictable Yonas Zerihun's job in the ride-hailing service is not immune to...

Agenda

BREWING DISCONTENT

Jul 28 , 2024 . By TIZITA SHEWAFERAW

Unhabitual, perhaps too many, Samuel Gebreyohannes, 38, used to occasionally enjoy a couple of beers at breakfast. However, he recently swit...

Fortune News

Electric Vehicle Push Leaves Investors in the Lurch

Jul 13 , 2024 . By AKSAH ITALO

Investors who rely on tractors, trucks, and field vehicles for commuting, transporting commodities, and f...

Commentaries

Growth Mirage Gives Way to Rising Poverty

The World Bank's latest brief on poverty and equity in, released this month, paints a...

Why Do Prospective Investors Look the Other Way While Bank Profits Surge?

In the domestic banking industry, earnings per share (EPS) have emerged as a potent b...

Fineline

Leaders of the National . . .

Leaders of the National Election Board are in a charm offensive mood, of a sort. Last week, they organised a rare tour for members of the me...

When the country’s most. . .

When the country's most senior diplomats and envoys return back to their posts after two-week debriefings, they leave behind a point or two...

Editorial

Official Narratives Preach Recovery. People Don't Feel It

Oct 18 , 2025

The political establishment, notably the ruling party and its top brass, has become p...

The Human Flight a Failure of Political Imagination, Not a Mere Economic Policy

Oct 11 , 2025

Ladislas Farago, a roving Associated Press (AP) correspondent, arrived in Ethiopia in...

Central Bank Loosens Credit Reins But Stops Short of Bold Overhaul

Oct 4 , 2025

Eyob Tekalegn (PhD) had been in the Governor's chair for only weeks when, on Septembe...

Exam Policy Fails the Test of Justice, Deepening Inequality, Disillusion

Sep 27 , 2025

Four years into an experiment with “shock therapy” in education, the national moo...

Gallery

Parliament Approves New Cabinet Members

Oct 6 , 2021

Parliament Approves New Cabinet, Incorporates Opposition Leaders Lawmakers have approved today the nominations of 22 ministers, including three opposition leaders. Two MPs have voted against, while 12 abstained...

2020 in Posterity

Jan 5 , 2021

TIGRAY VOTES DESPITE "NULL & VOID" THREAT

Sep 9 , 2020

IN-PICTURE: LAUREATE'S RECEPTION  

Dec 14 , 2019

PM Abiy Ahmed (PhD) at a Gala Dinner Called for the Awarding of the Félix Houphouët-Boigny Peace Prize

May 6 , 2019

Faces, Voices of Addis Abeba

Apr 26 , 2019

Sunday With Eden

Luxury of the Ordinary

A few weeks ago, I stood before a shop window in Addis Abeba, staring at a child's outfit, simple trousers and a shirt priced at 7,000 Br. F...

The Power of Staying Unexplainable

There's a version of us that lives in our parents' minds, the child they raised, frozen in time no matter how old we get. Another version ex...

Life Matters

The Price of Paying Right

It's strange how something as ordinary as paying for groceries can spark a lesson in how fractured Ethiopia's digital payment system remains...

The Savior Complex, When Helping Hurts

I have this one friend who absolutely amazes me. She's fiercely loyal, always trying to help, and practic...