Illegal Fuel Trade Booms As Supply Disruptions Leave Drivers Idle | The Reporter Ethiopia

Drivers are paying exorbitant prices for fuel in a parallel market that has only grown more lucrative in the wake of the war in Iran and associated global supply disruptions.

An anonymous source working as a driver for a private company told The Reporter that he encountered extreme fuel prices while operating in the Gambella region, where access to fuel through legal pumping stations was severely limited. A liter of diesel retails for upwards of 500 Birr in the region’s parallel fuel market.

“There was no alternative. Without fuel, the work stops,” the driver told The Reporter.

In Addis Ababa, fuel shortages are also straining daily operations, with long queues forming at stations and complaints of unequal access becoming increasingly common. Drivers say informal payments are influencing service delivery.

“Those who pay between 300 and 400 Birr per liter often get priority,” said one driver who requested anonymity. “Others are forced to wait, losing two to three working days in the process.”

The situation has fueled the expansion of illegal fuel resale networks. In rural areas such as Chancho, on the outskirts of the capital, fuel is reportedly being diverted from legal stations and resold at inflated prices through informal channels.

Lemma Bedane, a driver, said he purchased benzene for 350 Birr a liter from individuals operating out of private residences.

“These sellers buy fuel from stations and resell it illegally,” he said. “They store it in houses and sell it in small plastic containers.”

According to Lemma, access to these suppliers often depends on trust and local connections.

“If you don’t look suspicious, local drivers may guide you,” he said, pointing to the covert nature of the trade.

The financial impact on drivers has been significant. Transport operators report that the cost of filling a vehicle has more than doubled under current conditions.

“Previously, I paid around 7,000 Birr to fill my tank at official prices,” Lemma said. “Now, it can reach up to 16,000 Birr. It’s becoming impossible to manage.”

The reports sharply contradict the government’s amended rate of 163 Birr per liter of diesel, underscoring the widening gap between official pricing and realities on the ground.

A member of the Ethiopian Petroleum Dealers’ Association, speaking on condition of anonymity, said the situation reflects broader supply chain challenges.

“When fuel distribution slows, artificial shortages emerge, creating opportunities for illegal price increases,” the official said. “We are hearing about unauthorized sales at 300 to 400 Birr per liter in several areas, including Addis Ababa.”

He added that high demand from large-scale development projects is also contributing to the pressure. Companies engaged in construction and infrastructure often choose to purchase fuel at inflated prices to avoid costly delays.

“Project interruptions can result in significant losses, including salaries, contract penalties, and time overruns,” he said. “As a result, some companies opt to secure fuel at any available price.”

He called for stronger government oversight and more efficient fuel distribution systems to address the growing crisis. He also suggested that expanding private sector participation in fuel distribution could help stabilize supply.

“Strict price controls alone cannot resolve the issue if supply remains constrained,” he said. “Without improved distribution, such controls may unintentionally worsen artificial shortages.”

The situation underscores the urgent need for coordinated policy measures to stabilize supply, strengthen monitoring, and restore confidence in the formal fuel distribution system.