NIGERIA SNEEZES, GAMBIA CATCHES COLD

The year 2012 starts with astounding events unfolding in the Western part of Africa, with Nigeria reeling amidst protests for fuel subsidies, combined with threats imposed by the belligerent Islamic sect – Boko Haram. However, as Nigeria’s protest shows no sign of winding, Gambia’s oil market faces Diesel scarcity, leading to a handicap of the country’s transport sector.
On Saturday, the cloud that brings no fortune to the transport sector descended in the country, leaving several hundred vehicles and businesses dysfunctional.

From Brusubi – the country’s burgeoning metropolis – to Basse, the second capital, every diesel-consuming machine catches cold, as Nigeria sneezes from oil subsidy protests that swapped Africa’s largest oil producer overnight. After many years of experiencing diesel shortages, the country has fallen prey to gasoil scarcity again, handicapping economic opportunities as commercial vehicles and businesses are in a standstill.

As Senegambia Galp Energia petrol station runs out of diesel, so did the other several ten of petrol stations in the country. Thus on one side, this unfortunate scenario affects Galp Energia Ltd, Elton Ltd, Castle Oil Ltd, and Elton Ltd, the four companies that are involved in the retail of liquid fuel in the country.

“I think we are more affected by the fuel vendors, because if they don’t sell diesel, they sell petrol. So you can see their business is still moving at least. My taxi uses diesel, and since I understood there is no diesel in town, I decided to park it, before my remaining diesel dry up and I get stranded along the road,” said Modou, a taxi driver.

The shortage also affects many commercial vehicles, and even passengers who live on the breadline. Many could not afford to hire a taxi, as taxi men whose vehicles use petrol have decided to run only when they are hired. However, the very many whose vehicles consume diesel continue to suffer as their cars are left parking in garages and homes.

The shortage also creates transport problems, many also fearing that whenever diesel is available again, it will witness a hike in price.
However, as gasoil scarcity strikes the country, there are pockets of other people who stand to benefit from it. Taxi men who drive vehicles that consume petrol were on the smiling, as passengers scramble for vehicles on streets and main roads of the country. Many of them have opted not to resort to the normal routine of taking passengers from a designated destination to the other; rather they have chosen to be hired – which is more lucrative. This business-orientation-phenomenon has created transport problem, especially on busy days like Mondays, when many people were plying their way home after hectic weekends.

“My vehicle consumes petrol and since Saturday I have earned something that I cannot earn for a week. I used to run from Bursubi to Galp Energia fuel station in Kairaba and get no more than D50 for one trip, but now in only a single trip I accumulate up to D150. This is because I am always hired,” said Sol, a taxi driver.
An attempt was made by this reporter to speak with petrol stations managers, stakeholders in the energy sector, and those in the energy supply business, but to no avail. Many of them requested the red tape system.

Consequently the government has been subsidizing the price of diesel, but increment in the world market has affected the country in recent times. It could be recalled that the prices of both petrol and diesel were increased in May 2010 to reflect the rising price of the fuel in the world market. However the increase in the price of diesel was much lower; thereby making the price of diesel much lower than the real world market price, thanks to government’s subsidies.

The Gambia, like most oil importing countries, is susceptible to any exogenous shocks such as price increases in world oil prices. Any increases in external costs translate directly to higher importation costs and as a result higher prices at the pump. Taking into account Government taxes, any further increase in world oil price will lead to an erosion of the gains in the country’s development efforts.

The Gambia is heavily dependent on imports to meet its petroleum requirements. Petroleum products consumed in the Gambia is all imported. It is the second most important source of energy in the country, after fuel wood, accounting for about 17% of total primary energy needs according to the 2004 energy balance. The petroleum requirements of the country consist of gasoline (regular and premium), kerosene, and diesel oil (gasoil), LPG and jet fuel.