Mozambique: Beira Fuel Crisis Was Due to Silting of Port

24 July 2009

Sao Paulo — The shortage of diesel over the past week in the central Mozambican city of Beira was due to problems of silting in the port, and not to any boycott by the fuel importing and distribution companies, according to Energy Minister Salvador Namburete.

Speaking to the Mozambican reporters who covered President Armando Guebuza's visit to Brazil, Namburete revealed that a tanker should have delivered fuel to Beira weeks ago. But the silting of the access channel made it impossible for a ship this large to enter the port.

The tanker was thus diverted to the northern port of Nacala, a deep water port that never needs dredging. Only when dredging had resumed in Beira, deepening the access channel, was a tanker able to enter the port and unload diesel on Thursday.

Namburete believed there was now enough diesel to end the crisis, and within a few days all the filling stations in Beira and the rest of Sofala province would be supplied.

On 16 July, the Association of Mozambican Fuel Companies (AMEPETROL) had threatened to reduce or interrupt supplies of fuel unless the government agreed to increase the price of fuel at the pumps. Namburete stressed that this threat had nothing to do with the diesel shortage in Beira.

Furthermore, the government had already promised, in writing, that the fuel companies will be compensated for their losses, arising from the difference between the world market price of fuel, and the price at the Mozambican pumps. Namburete guaranteed that the government is taking measures to ensure that the country will have enough fuel to last until the end of the year, without any price rises.

Just as measures had been taken in 2008, when international fuel prices soared, to compensate the companies and cushion the consumer (essentially by waiving taxes on fuel), so now the government was again prepared to compensate the companies.

He pointed out that, when the speculative boom ended, and the price of oil collapsed, the government did not immediately cut Mozambican prices. Indeed the government had, in late 2008, resisted popular pressure for cuts in fuel prices, in order that the fuel companies could recoup losses they had suffered earlier in the year.

"I think our partners should bear this sort of measure in mind when they assess the problem of international oil price fluctuations", said Namburete. "They should know that the government pays attention to the situation and will not let them sink"./.