Artificial Gasoline Shortage In Liberia Raises Huge Travel Burden For Commuters
By: Jallah D. Massah IPNews-Monrovia-Liberia-30 October 2018: The artificial scarcity of petroleum products on the Liberian market is becoming a cause for concern, as major importers and the Liberian government remain in a deadlock over a new price. Several major service stations across Monrovia and Paynesville are short on product, and some retailers have hiked the price while others are creating artificial scarcity. On yesterday, Monday, October 29, consumers, including drivers, were seen moving from one station to the and where gasoline was available and vehicles were seen in long queues and Stations that have limited supplies were rationed to customers at a gas station in Sinkor, customers were allowed to only purchase 2 gallons of gasoline at a given time while the gas was on sell for $ 750 to 800 LD and still the price did not matter especially to private vehicle owners. I rode on board one keke where passengers were attributing the shortage of gas to the recent rumors of Total Liberia closing its operation in Liberia which they said will greatly affect the Country economy because Total-Liberia is the fourth largest oil and gas company as well as an integrated player in the renewable energies that started operating in Liberia since 2005 with the approximate number of 30 service station and the size of seventy of the workforce The Ministry of Commerce and the Liberia Petroleum Refinery Company – two government agencies responsible to regulate the sector – are so far tight-lipped, prompting sector observers to warn that the situation may potentially be heightened Sources say the importers are calling on the government to take several actions to avoid the risk. The decision, they say, should include waiving some tariff placed on storage fees. This is happening at a time the price for a barrel of crude oil has increased in the world market. The current price of a barrel of Brent crude so far this month is 83.15$ per barrel, while the price was 78.89$ dollars per barrel in September of 2018. Over the last twelve months the price rose by 44.58%. Brent oil makes up more than half of the world’s globally traded supply of crude oil. Brent blend crude serves as a benchmark price for purchases of oil worldwide. It is traded electronically via the ICE futures exchange. Importers in Liberia are concerned that the uncertainty of the global factors is impacting the local market condition and would adversely trigger down on the prices of other major commodities if intervention is delayed. It can be recalled that the top Liberian importers of gasoline in recent time stressed highlighted the massive increment of the price of gasoline over the world market through a letter addressed to Minister Samuel Tweah Chairman of the government’s Economic Management Team. The importers are NP, Liberia Aminata and Petro Trade also expressed their “inability” to meet the road fund obligation as part of a tax scheme to support government’s road construction in the country. While the government and importers are reportedly staying behind closed doors sorting out the relatable issues about the price of petroleum, drivers are sweating over the availability of petroleum products across town as sources have told this paper that gas station owners prefer given gas to the side ward boys to sell thus creating a false shortage over the Liberia market. Meanmhile , Liberia does not have a well-developed upstream oil and gas industry. Hydrocarbon exploration activities in the Liberian territorial waters started in the late 1960s, but those activities ceased due to a variety of factors including civil unrest and political instability. Liberia has a number of offshore oil blocks, some of which have been licensed to multinational oil companies. The blocks are from the continental shelf to water depths of 2500-4500 meters, and exploration activities require multimillion dollar investments. Expectations for significant offshore oil discoveries became high as a number of international oil companies– such as Anadarko Petroleum, African Petroleum, Chevron and ExxonMobil–signed productions sharing contracts (PSC) with the Liberian government. Although some of these companies subsequently began exploratory drilling, none has yet reported commercially viable oil deposits.