The petrol bomb, so to speak, has gone off again. Only this time, its intensity is heightened because of its timing and the ripple effects it would have for the middle and lower classes. Reactionary quarters blame the government, the government blames the international prices, and the international oil companies blame the deteriorating situation in the Middle East.
A holistic view of the recent price hike in petroleum products may not be possible but necessary nevertheless. With the pressure from IFIs and the international oil market, this price jump was inevitable. Whereas the opposition is crying foul, coalition partners are claiming it to be a necessary evil. Even the soon-to-be coalition partners have taken a 180 degree swivel on the issue. Positions on the issue are not a matter of right and wrong but a mere function of which side of the national assembly your lot sits. Contrary to what the populist propaganda machine might have us believe, there is no alternative to the situation. Even if a cut is made in the oil prices in the country, the difference between the international and local prices has to be balanced out somehow. It can either be in the form of a subsidy or price increase. And subsidies are, theory tells us, neither sustainable nor suitable.
What with our dependency on running the industry on fuel, our energy profile’s major portion (around 65-70%) also depends on fuel, a fact that is glaring straight in our face. This adds more fuel to the fire, figuratively. The situation is no better in other parts of the world either. In fact we are almost level with the US and UK, price wise, despite a huge difference in overall consumption.
This, by no way, means the government should resign itself to fatalism. Perhaps some positive developments on the revenue generation front can eventually get us in a better position to translate fluctuations in the international markets in a relatively painless manner.
