Gasoline cuts strike Egypt
Egypt's budget deficit is expected to reach LE 114 billion ($19 billion) in the fiscal year to June 30, some 8.7 percent of gross domestic product
Across Egypt, long lines of cars and trucks snake around the corner from gas stations, drivers spend the night in their vehicles waiting for fuel at the pumps, and gas stations attendants complain of receiving only half their usual quantity of fuel — or none at all.
Days into an increasingly acute fuel shortage, Egyptians are starting to feel the squeeze. Drivers are searching frantically for fuel, only to find gas stations sold out of key grades of gas. In rural areas, witnesses say scuffles and knife fights have broken out among frustrated drivers. Some have even fired guns in the air.
The reasons behind the shortage — or even if there is one — are not clear. The government blames any shortfall on profiteers reselling subsidized fuel on the black market. Many Egyptians, however, accuse the authorities of trying to cover up what they say is the government's mismanagement of an ailing economy.
Petroleum Minister Abdullah Ghorab flatly dismissed talk of a shortage, saying fuel supplies exceed demand. He said the crisis stems from "mistrust between the government and the citizens," according to the state-run MENA news agency.
Another Petroleum ministry official, Hani Dahi, was also quoted by MENA as saying that there is "a rise in the illegal use of fuel" and calling for tighter security measures to prevent black market dealers selling subsidized fuel at higher prices. However, the manager of one gas station in Fayoum, a city south of Cairo, put the blame squarely on the government's shoulders and its stewardship of the economy.
"I used to get a daily supply of 30,000 liters (7,900 gallons) of diesel, now I get 13,000 every three days," said the manager, who asked not to be identified. "Any talk about smuggling is a sheer lie because if there is enough fuel in the market, none would buy from the black market." "Why blame the people? Why don't you put it as simple as this: We don't have foreign currency to buy the fuel," he added.
Egypt's economy has been badly battered by the political turmoil following last year's uprising that ousted longtime leader Hosni Mubarak. Political instability and violent street protests over stalled reforms have hammered the tourism industry, a key source of foreign currency, and caused foreign investment to plummet.
Egypt's budget deficit is expected to reach LE 114 billion ($19 billion) in the fiscal year to June 30, some 8.7 percent of gross domestic product. The country is negotiating a $3.2 billion loan from the International Monetary Fund, and looking at other steps like selling state-held land, to help patch up the budget.
The fuel crisis is the second in Egypt since January, and may open the backdoor to changing the state subsidies on fuel and other basic commodities, which cost the government some LE 100 billion a year. On Thursday, the petroleum minister used the current crisis to call for revisions to the subsidies.
Two months ahead of presidential elections, the shortage also has fueled finger pointing between Egypt's military-backed government and Islamist-dominated parliament. Some lawmakers accused the government of fabricating the crisis to embarrass parliament.
"The military council, through its government, is telling the people, 'Look, your representatives are not able to solve your problems,'" said Essam Sultan, a lawmaker from the Islamist Al-Wasat party.
The country's wider economic malaise is increasingly taking a toll on Egyptians in their daily life, with rising inflation and unemployment now compounded.