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Instead
of easing petrol shortages, a rationing scheme soon
to be introduced in Iraq looks likely to create a
new currency for the black market.
A petrol rationing scheme now running in some
Kurdish towns is likely to be extended to the whole
of Iraq in the next few months. The aim is obviously
to calm the fuel market and give drivers regular
access to petrol, but the system has so far had the
reverse effect, creating a flourishing black market
to meet the demand.
Kirkuk and several northern cities in the Iraqi
Kurdistan region have been distributing petrol via a
ration card system since April.
The Iraqi oil ministry this month introduced a
nationwide rationing scheme for oil-industry
products used in the home, such as gas for cooking
and kerosene for lamps, and plans to extend this to
vehicle fuels later this year.
The ministry hopes that rationing will ease a fuel
distribution crisis which has resulted in long
queues at petrol stations and an upsurge in
smuggling.
But the experiment in Kurdish areas is not
encouraging. Many people simply sell their fuel
ration onward the moment they collect it, instantly
doubling their money.
Each car owner is entitled to buy 240 litres of fuel
a month, but has to make eight separate visits,
“spending” one of the 30-litre sections marked off
on the ration card. Taxi drivers are allowed a
higher monthly maximum of 320 litres.
The ration cards are changing times at many times
their value. Each 30-litre unit allows the owner to
buy that amount of petrol for between 2,000 and
3,000 dinars, but on the streets it will be traded
for 4,000 to 5,000 dinars.
Complete monthly ration cards are going for as much
as 100,000 dinars. Taxi driver Nuraddin Hasan said
that is the price paid by racketeers at the al-Salam
petrol station in Kirkuk, where he is a regular
customer – and he is outraged. “I have complained to
officials, but nothing came of it,” he said.
Rationing has simply transformed the black market in
fuel itself into much easier transactions involving
the coupons that give access to it.
“Instead of queuing for long hours to get petrol,
the taxi drivers are buying and selling ration
coupons, which makes profitable work,” said Ahmed
Sultan, manager of the al-Salam petrol station.
Adolescent boys are involved as intermediaries.
Some, like 13-year-old Ali Salim, trade in petrol
bought from drivers who have ration cards. Ali Salim
spends 12 hours a day shifting bottles of fuel to
provide for a family of 10 in which he is the
principal breadwinner.
But Mohammed Abdul Qadir, 16, is part of a new breed
of traders, and has just spent his summer holidays
dealing in ration cards without handling the
commodity itself.
“We buy the coupons off drivers,” he explained.
“It’s easier to make a profit than from selling the
petrol itself, which is banned by the police
anyway.”
A more complex variant on the theme is operated by
some of the petrol stations, according to a pump
attendant who spoke to IWPR on condition of
anonymity. He said petrol stations quietly buy up
expired or invalid ration cards from members of the
public, record them as legitimate sales on the
accounts they submit to the local oil ministry
office, and then sell the petrol at a huge mark-up.
Fadhil Shafiq, who is director of the petroleum
products division at the Iraqi oil ministry’s Kirkuk
branch, says that rationing, flawed though it may
be, is better than no system at all.
The underlying problem, Shafiq believes, is that
lack of refineries to process the crude extracted
from Kirkuk’s large oilfields.
“The government buys in petrol from Turkey, but it
would be better to use the money to build a refinery
in Kirkuk,” he said.
Other argue that people are only exploiting the
system because they are so desperate to make a
living. Yashar Izzet, who works at the Babagurgur
petrol station in Kirkuk, said the trade in ration
cards would disappear if people had proper jobs.
“The young lads have nothing else they can do, so
they are willing to make money from any kind of
work,” he said.
Samah Samad is an IWPR trainee journalist.
www.iwpr.net
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