Ethiopia: Sudanese Company Suspends Oil Supply

by yeEthiopiaforums

Addis Ababa — Sudan Petroleum Company has temporarily suspended the agreement signed on fuel supplies to Ethiopia, after the Sudanese oil firm closed its refinery earlier this month, Sudan Tribune has learnt.

The agreement between Ethiopia and Sudan Petroleum Company (SPC) was to import 80 percent of its total oil demands from neighboring Sudan. The three-month suspension is likely to cause a hike in oil prices due to Ethiopia’s lack of oil reserves.

According to sources, the Horn of Africa country spends an average annual 20 billion birr (USD 1.2 billion) to import fuel. Ethiopia is expected to import 2,176,188 tonnes of oil this year.

The country says that it saves millions of dollars, mainly from transportation, costs by using Sudan as a fuel source instead of shipping fuel from Gulf Arab states.


To cope with the ever increasing oil demand across nation the Ethiopian government decided, in 2008, to start blending ethanol to make it go further. Introduction of the new ethanol blending is said to help the country reduce the volume of benzene imports by over a million dollars annually.

According to the Ethiopian Petroleum Enterprise (EPE), an entity in charge of petroleum importation and distribution, high oil consumption by the government, insufficient oil imports along with variation of prices on the international market has resulted in an extra 500,000 tons being imported in the 2010-2011 fiscal year.


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