The Ukraine-Russia crisis has its toll on the world economy as an established fact. This toll on the world economy has not only affected the petroleum industry but prices for commodity and essential food stuffs and services. While the majority of Africans argue they do not get direct fuel from Russia or Ukraine, it is certain the reduce supply to other regions with request from other countries is bound to affect even the normal supply route for most African countries and Sierra Leone is not an exception. The question is what are those African countries doing to salvage the situation that Sierra Leone is not doing? Is Sierra Leone slow to act? Are people in the petroleum industry managing the crisis well enough? Are vendors looking for the chance to increase profit at the vulnerability that currently lies in the world? Are petrol stations creating artificial scarcity to up price per litre using the black market route?
The authority charged to deal with petroleum in Sierra Leone, The Petroleum Regulatory Authority (PRA) have in series of press releases said there are no fuel scarcity and that more fuel is being imported to cope with demands over the festive period and sufficient enough to last up till February 2023. Expected consignment arrivals are detailed as between December 14 to December 18 from the two major importers, Petrol Leone and Conex Energy.
Severally, the PRA has been accused of price increase, inadequate monitoring of petrol stations and dealers and insufficient fuel supplies within the country. This however has been met with stiff resistance from the PRA but the effect of their proclamation is scanty seeing the current trend.
In a recent press release, The PRA denotes fuel within the country is sufficient and that there will be no price increase on the current pump price for the rest of 2022. They have also proposed strict monitoring over the festive periods at fuel stations. This has always been the position of the PRA but little is done to see the effect as dealers take price control into their own hands with hopes of price increases and maximised profit through sales to the black market.
Currently, several cities across the nation see elongated cues for fuel. Black market price for fuel per litre otherwise known as “Jebu”, is now sold at NLe35, which is more than 3% of the petroleum pricing regulatory stipulated pump price. Furthermore, fuel station sale rationing is on the increase driving the demand higher thus resulting in price hikes. Something definitely needs to be done on monitoring, consistent supply chain structures and pricing unification.
In Sierra Leone, very few importers rock the petroleum industry thus impacting on the supply chain and price. There is a perceived monopoly within the petroleum importation sector. The more the merrier, Edmond Abu, a fearless civil society activist of Native consortium comments. In an industry of very few players, the flow of goods, price and customer satisfaction is at stake. A liberal and open market approach is key for competition, which is currently lacking to the detriment of the ordinary citizen. Preferential treatment to accessing petrol and diesel is quite visible. Who knows who and clan based approach to buying the products of petroleum is now the order of the day in certain cities across the nation. The lesser in societies and the ordinary man is being distant at getting petrol even for those trekking longer distances from villages.
The major employment for youths in Sierra Leone, the “Okada Riders” (local motorbike taxi service) are being hit the most. Inter-town and city transportation has doubled. The resultant effect is price hike for commodities to appreciate profit margins based of capital investment especially on moving commodity from one point to their final destination for sales to customers. The once frowned at approach to selling fuel in litres is now becoming the norm compromising fire hazard.
Where are we heading for? The Native Consortium activist, Edmond Abu, predicts Sierra Leone will end up having the highest pump price in the region if certain approaches aren’t taken. Will authorities sit by for the actualisation of that prediction?
Written by Ali M. Tokowa.