Sporadic Fuel Crisis in South Sudan: Causes, Impacts, and Solutions

The Sudd Institute

Authors: Nyathon James Hoth Mai, Nhial Tiitmamer, Augustino Ting Mayai

Organization: The Sudd Institute

Type: Special Reports

Date: 03/03/2016

Keyword(s): South Sudan

 

Publication Summary

South Sudan has encountered waves of periodic fuel crisis since 2011. The government has attempted quick-fix measures, but the crisis has continued unabated. Despite a number of speculations surrounding this matter, however, the actual causes and impacts are not necessarily well understood. In this analysis, we attempt to fill this knowledge gap. Thus, drawing from various data sources this work examines the causes and impacts of fuel crisis on the country’s economy, and offers a number of potential solutions.

 

Despite being locally produced, coupled with drastically plummeting global crude oil prices, fuel costs more in South Sudan than elsewhere in the region—invoking a paradox. Secondly, the prevailing shortage and high cost are a consequence of a myriad of explanatory factors, namely hard currency shortage, high taxes and duties, absence of refineries and depots, growing demand for oil from electricity producing and consuming sectors, and inefficiency in energy use. These factors are exacerbated by gaps in institutional, regulatory and policy frameworks, lack of fair market restraints, and corruption. Consequently, this has led to fuel hoarding, hikes in transport cost, reduced productivity, amplified social stratification, and the soaring prices of basic commodities. After the floating of the South Sudanese Pound against the US Dollar mid December last year, a new phenomenon occurred. Instead of fuel shortage, there is a drop in demand after the price of a liter was increased from 6 SSP to 22 SSP. In other words, the high costs of fuel have prompted low demand, as a good number of motorists, households, and businesses that are dependent on diesel powered generators for electricity now face affordability problems.

 

To achieve energy security or sustainable, reliable, and affordable energy supply, South Sudan needs sustainable peace, diversified sources of energy and exports, depots and refineries to meet domestic consumption. Meanwhile, the country ought to: reduce costly import duties and taxes to lower prices, strengthen its economic relations with Sudan and Kenya to ensure adequate access to fuel, as well as pursuing public awareness on conservation and efficient use of limited fuel supply to lower demand and protect the environment. The recent re-opening of the South Sudanese-Sudanese borders and the admission of South Sudan to the East African Community are opportunities in the right direction. 

 

Nyathon James Hoth Mai's Biography

Nyathon James Hoth Mai is a visiting fellow at the Sudd Institute. She has a BSc in Geology from the University of Ballarat, Victoria, Australia, and an MSc in Global Energy and Climate Policy from the School of Oriental and African Studies (SOAS), University of London. She is also an independent Researcher and policy analyst. Her research interest areas include: Geology, climate change and energy policy, and issues affecting South Sudanese women. In addition, Nyathon was the Co-founder and Managing Director of My Referendum for Freedom (MRF) that actively engaged the South Sudanese youth from all over South Sudan and diaspora as a vehicle for civic education to the rest of the populace during the South Sudan Referendum. She also devoted much of her time to South Sudan community development in Australia.

 

Nhial Tiitmamer's Biography

Nhial Tiitmamer is Programme Manager for environmental, energy and natural resources research and as well the Institute’s Focal Point on Building Resilience and Adaptation to Climate Extremes and Disasters (BRACED), a climate change resilience programme being implemented in South Sudan by a consortium composed of The Sudd Institute and five international organizations. Nhial holds a Bachelor’s Degree and a Master of Science in Environmental Studies and Sustainable Energy from the Universities of Alberta and Calgary in Canada where he spent stints as an environmental consultant and research associate in environmental studies. Nhial is the co-founder of the NewSudanVision.com and has extensively commented and written on issues about South Sudan.

 

Augustino Ting Mayai's Biography

Augustino Ting Mayai is the Director of Research at the Sudd Institute and an Assistant Professor at the University of Juba’s School of Public Service. He holds a PhD in Sociology, with concentrations on demography and development from the University of Wisconsin-Madison. He currently studies how state effectiveness affects child health outcomes in South Sudan and Ethiopia. Dr. Mayai has written extensively on South Sudan’s current affairs.

 

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