August 22, 2006

Posted by NBC local journalist in Baghdad*, undefined (10:14 am ET, 08/22/06)

Fuel prices in Iraq have reached peak levels – with gasoline costing approximately $6 per gallon.

The costs of diesel, liquid propane gas used for cooking, and kerosene have risen to levels totally disproportionate to Iraqi’s incomes – having a huge impact on day to day life for regular people.

Many people in Baghdad have abandoned their cars – even selling them. Those who can afford to buy gas go through extreme frustration to get it – sometimes waiting all night in endless lines to fill up their tanks – or are forced to buy gas on the black market at extremely inflated prices.

Meantime, the costs for taxis and the mini buses - widely used by Iraqis - have risen dramatically, too. For example, two months ago the bus fare used to be 500 Iraqi dinars or about 33 cents. Then a month ago the minibus drivers raised their fares to about 50 cents; now the drivers are charging about 67 cents.

Four hours of electricity a day, or pay

Elsewhere, the major problem for people remains electricity. The state power supply average is just four hours a day! That’s been my personal experience in my neighborhood and the same goes across Baghdad from what I’ve gathered chatting with people on gas lines and elsewhere.

That means that most Iraqis are left relying on private generators in their neighborhoods to get power – and forced to pay whatever the owners of the generators are charging.

It used to cost about $5.40 per ampere, or unit of electricity, per month - the average Iraqi family requires at least 10 amperes a month per housing unit. Now, owners of the power generators are charging almost double – about $10 a month per ampere.

Many people can’t afford to pay that much each month. Others are forced to accept the costs because they know very well that they have no choice: either tolerate the nearly intolerable heat in August or pay.

Some generators owners have even stopped supplying power saying that the $10 per ampere doesn’t even cover their costs.

The vegetables and fruits markets have not been exempt from the fuel crisis either. Everything is getting more and more expensive. Hassan Al-Baldawi, recently went shopping with his wife and spent around $70 just buying basic foodstuffs.

Reasons? Excuses?

The Iraqi people have been given all sorts of reasons for the worsening fuel crisis.

Both Deputy Prime Minister Salam al-Zobaie and the Minister of Oil Hussein Al-Shahrestani addressed the shortage of petroleum products in recent interviews and press conferences. The government blames the rising costs on the terrorist attacks on the pipelines and the gasoline tankers. "Terrorists conduct attacks against the tankers loaded with fuel and prevent them from reaching the capital," explained the minister of oil.

The Iraqi army and police place the blame for the shortages on black market profiteers. But, the black marketers in Baghdad say, hey, don’t blame us.

I spoke with Marrwan Hammed who sells gasoline in the Mansur district, and Fadhil Omar, who sells it in the Mammon neighborhood. They both said, "It’s not us. The proof is that we have been selling gasoline for three years now. There was no fuel crisis during the Jafari transitional government era!"

Gas station officials have no easy answers either. The director general of the Bayaa gas station in the south west of Baghdad blames "the lack of distribution and the chaotic queues" as the main reason for all the problems.

Amid all these excuses, the Iraqi people are of course the biggest losers in the game.

Ali al-Omari, a teacher who was waiting with his car in the middle of a long line at the Yarmouk gas station in Baghdad, placed the blame for the problems on the government and police corruption.

"It is always the government's lack of control, and failure of its policy," said al-Omari. He also blamed the Iraqi army soldiers who are supposed to protect the gas station, but instead take "bribes of 2,500 dinars [$17] just to let you break the line to fill your tank first."

* The names of local journalists are not being used to protect their identity.