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Sun 26 Jun 2011 08:35 AM

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Adnoc sees new chief in petroleum council shake-up

Abdullah Nasser Al Suwaidi named director general of Adnoc as UAE petrol shortage drags on

Adnoc sees new chief in petroleum council shake-up
Adnoc sees new chief in petroleum council shake-up
Petrol station, fuel shortages

Abdullah Nasser Al Suwaidi was Saturday named director general of the Abu Dhabi National Oil Co (Adnoc) following a reshuffle of the UAE’s Supreme Petroleum Council.

The restructuring, led by UAE President Sheikh Khalifa bin Zayed Al Nahyan, also named 10 members to the council that lays down the Gulf state’s petroleum policy, state news agency WAM reported.

The news may signal a policy change after more than four weeks of petrol shortages at more than 80 Dubai-owned Enoc and Eppco stations in the northern emirates.

Adnoc was last week ordered to take action to help solve the fuel shortage and has since ramped up petrol supplies at its filling stations to ease pressure in affected emirates.

Sharjah on Saturday shut down more than 30 Enoc-owned filling stations in the emirate after the fuel retailer failed to comply with a 72-hour deadline to restore fuel supply to its outlets. Barriers were placed at the entrances to the station, barring motorists from entering the forecourts.

The UAE’s third fuel shortage in 10 months was initially blamed on maintenance at petrol stations owned by ENOC and its unit EPPCO, an explanation rejected by Sharjah’s Executive Council.

Analysts say the problem lies in government subsidies, which look increasingly unsustainable as ballooning oil prices drive up the cost of supplying fuel to customers at a cheaper, fixed price.

ENOC and rival state-owned retailer Emarat have suffered because they buy fuel at market prices and sell it at government-set rates. Enoc said in May it would have to meet an additional AED2.7bn ($735.3m) in 2011 to cover the cost of providing subsidised fuel.

Three of the UAE's four fuel retailers - ENOC, EPPCO and federally-owned Emarat - have been making losses for years.

Abu Dhabi-owned Adnoc has faced no fuel interruptions.

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charles 8 years ago

Please double the price of petrol immediately. That will be a start point to realistic pricing and more importantly, realistic usage.

Hmmmmm 8 years ago

@ Charles

if life would only be so easy. Hiking the fuel price will result in price hikes for a lot of goods and services.
With fuelling inflation - as inflation is not caused by an exact mathematical formulae but rather by psycological expectation - you might actually get a stone rolling that might turn into a landslide.

Nobody wants that landslide, and I do not blame anyone becasue they do not want to be the ones who get the first stone rolling.

Telcoguy 8 years ago

True it would not be easy, and prices would increase for a number of items (if not all).
But being a single event it should not impact people's expectations, as you correctly point that often happens when inflation expectations become ingrained.
The real impact would be on the medium and long term productive mix of the country, but even on that I see no problem. We keep reading about how too many expats are diluting the UAE essence, well, maybe it is time to remove the labor subsidies (petrol, food, accommodation) and move from industries that are intensive on unskilled labor and need these subsidies to survive to a different model, less reliant on laborers.
That would be more consistent than the current situation when we have Government officers complaining about too many expats and the same Government providing subsidies to keep these same expats employed.