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Gas shortage in Iraq due to corruption, power failures, sabotage

BAGHDAD—Sky-high petrol and diesel prices and mile-long gas lines have sprung up across Iraq again in recent days and weeks, aggravating an already impatient public and giving Iraqis one more thing to blame on the Americans.

Oil ministry and senior coalition officials gave various reasons for the problems, from guerilla attacks on northern pipelines to the influx of new cars to supply and distribution problems, but none seemed to explain exactly why prices for gasoline—commonly referred to here as benzene—have climbed 400 percent since October.

In early October, black market gasoline cost 100 dinars a liter or $5 to fill a tank. By mid-November, prices had climbed to 250 dinars a liter or $12.50 to fill a tank. This week, in some places, black market benzene cost 400 to 500 dinars a liter or $25 to fill a tank, a fortune for a taxi drivers who might earn about $10 a day.

Gasoline is cheaper at the pump—20 dinars a liter or $1 to fill a tank—but black market buyers save time by buying gasoline from roadside jerry can operators.

Several people blamed the shortages on hoarding by the operators, who also have been charging big markups since the fall of Baghdad. On Sunday, these vendors were far fewer in number than in previous weeks, but benzene lines remained long, and patience short.

"I've been waiting here for four hours," said Hassan Mohammed, 18, who transports electric equipment in a white pickup truck and who was finally first in line at a Central Baghdad gas station at mid-day. "Last week, this would take less than an hour. This is the worst it's ever been, since the war."

Others began queuing up the night before.

"Only if the Americans go out of Iraq will all the problems be solved," said Shihab Turki, 24, owner of a car wash business next to the gas station. "They start parking here at 8 o'clock at night and wait for the gas station to open about 7 or 7:30 in the morning."

Benzene is one of the most important resources here because people need it to go to work. Shortages stoke tempers and fuel misunderstanding; fights and gunfire erupted at gas stations during shortages earlier this summer.

"This shortage is fake. The coalition forces make it, just like the gasoline shortage for trucks and the electricity shortage," insisted Abdul Rahman Kittab, 38, a taxi driver who prefers to wait all day in order to pay only 20 dinars or $1 to fill his tank at the gas station. "I work one day, the next day I spend in the gas line so I can work the third day."

Several gas station managers said they were not allowed to talk to the media without written permission from the Oil Ministry.

Oil Ministry spokesman Assam Jihad blamed the shortage on sabotage, including last month's attack on a pipeline that connects a refinery in the north-central town of Bayji with Baghdad. But chronic electricity blackouts also have lowered production levels in refineries and gas stations, he added.

"We've had terrorist attacks on the main oil pipelines, which are causing shortages," Jihad said. "The cutting off of electricity is now worse than it was before. And most petrol stations don't have generators."

The large number of cars being imported from Jordan is also part of the problem, as there has been no corresponding increase in the number of gas stations. And gasoline is now being shipped to all parts of the country, unlike during Saddam's time, when he stopped it from being sold in the autonomous Kurdish areas he oppressed.

An estimated 250,000 to 400,000 cars have crossed the border from neighboring nations since the fall of Saddam, Jihad said. Before, duties on luxury vehicles were as high as 100 percent, largely due to sanctions imposed by the United Nations. Now duties have been slashed to as little as $200 on some cars.

But the biggest reason for the long gas lines is corruption, Jihad said. Gas station owners are stashing away supplies of gasoline and selling it at higher prices to wealthy customers who don't want to wait in lines.

"We know that people are hoarding and selling petrol in the black market," Jihad said.

Lt. Gen. Ricardo Sanchez, the top military commander in Iraq, described the shortages as "an availability and a distribution challenge." While oil smugglers have been caught in the past, "interdiction of the infrastructure" is not to blame for the problem, he said.

The result is that in towns close to refineries, gas is slightly cheaper.

But in towns like Mamoudia, on the only main road between Baghdad and Najaf, it's more expensive. Tankers could be seen by the side of this road this week, directly dispensing gas to motorists. Black market vendors demanded as much as 1,000 dinars a liter or $50 to fill a tank. In the northern town of Mosul on Saturday, benzene cost 500 dinars a liter

One Baghdad jerry-can seller, Ibrahim Ahmed, 19, said he had no alternative. Formerly unemployed, Ahmed said he didn't want to have to resort to stealing or killing to make a living, "because these things are forbidden."

Gas stations are not supposed to sell benzene to him but they do, at 250 dinars a liter. Ahmed turns around and offers it to busy and wealthy motorists for 450 dinars a liter ($22.50 a tank). "I come here at 2 a.m. to get in the line and buy benzene," he said. "I have to survive."


(c) 2003, Knight Ridder/Tribune Information Services.

PHOTOS (from KRT Photo Service, 202-383-6099): USIRAQ+GAS