“There is petrol in some of them though, they are not all totally dry. By Thursday or Friday they will be normalised.”
This is the second time Emarat has blamed logistical issues for a lack of fuel. Last September the company said that issues at its Jebel Ali terminal had caused shortages.
However a Gulf News report at the time claimed that an Emarat source had told it that the company had llimited fuel because its convenience storm arm was unable to offset fuel subsidies in the UAE.
“Emarat is finding it difficult to get bank loans to enable it continue to sell petrol below cost, so it’s trying to ration the limited quantity of gasoline it has,” said the source. “The company is incurring a daily loss of about Dh2 million due to the subsidy on the fuel and compensation from other businesses such as convenience stores isn’t enough to cover the losses.”
The extent of the subsidies in the UAE are not released to the public, but Abu Dhabi’s suppliers have the advantage of the Emirate being able to refine its own crude oil. Conversely Dubai has to buy all of its gasoline from international markets, making companies sell at a loss at the pumps.
It also makes them prone to volatility in the market, and oil prices have continue to remain at $100-plus a barrel level contributing, according to the Dubai Statistics Centre, to the cost of transportation increasing by 9.72% in the first quarter of 2011.
