Facing freezing winter nights, families worry about being able to afford kerosene amid KRG distribution problems

20-10-2022 10:25


Over the past four winters, the Kurdistan Regional Government (KRG) has failed to distribute white kerosene to a majority of families that need the critical fuel to heat their homes, forcing those left out to scramble for limited supplies on the expensive open market.

Distribution of the government fuel prioritizes colder, mountain areas, but this approach leaves poor urban dwellers shivering.

According to officials, only about a quarter of families across the Kurdistan Region who qualify for vouchers receive kerosenesupplies.

Daban Shakour, who lives in Sulaimaniyah, has not received winter fuel from the government in the past five years and has to pay out of pocket on the open market to heat his family’s home.

"Every year they say kerosene is being distributed, but kerosene has not reached us," Shakour told Peregraf.

He expects fuel to cost much more this year because of higher oil prices and inflation.

"Not everyone can buy a barrel of kerosene. So, [government] distribution of fuel would ease that burden among all the othercrises resting on the shoulders of citizens," he said.

One 200-liter barrel of commercial kerosene currently costs more than 250,000 Iraqi dinars ($172) on the open market, butthis will go up to around 300,000 Iraqi dinars ($206) when the temperature drops. For those on limited and fixed incomes, thisrepresents a significant burden.

Each family that is issued a voucher is entitled receive at least one barrel of kerosene annually from the KRG, which covers the cost of any barrel costing more than 55,000 Iraqi dinars ($38). Last year, many families in colder areas used between two and three barrels of kerosene over the course of the winter, so an honored voucher can slash annual winter heating costs for a family by as much as half.

Yet the policy has only limited impact and litteraly leaves many people out in the cold.

"Since 2018, kerosene has not been distributed in urban areas," Diman Raza, a member of the Sulaimaniyah Provincial Council’s Energy and Natural Resources Committee, told Peregraf.

Sulaimaniyah governorate is divided into 11 zones for the purposes of kerosene distribution. The government disburses supplies in declining order of priority, but has never made it past the seventh zone.

"This is an injustice…If it is the same as in previous years, families in the colder areas will receive five barrels of keroseneand families in the city will get nothing," Raza added.

"It is the government’s responsibility to provide kerosene for itscitizens because people cannot afford all these crises," said Raza.


The same story again this year

Peshawar Hawramani, a member of the Kurdistan Parliament's Energy and Natural Resources Committee representing the Kurdistan Democratic Party (KDP), did not directly answer Peregraf’s questions about why this situation seems to reoccur each year, but indicated that the same plan will be followed this year as well.

KRG Minister of Natural Resources Kamal Mohammed facedquestions in the Kurdistan Parliament on September 13. He said that the KRG distributed 111 million liters of kerosene last winter, but needed more than 257 million liters to meet demandfully.

The KRG’s Ministry of Natural Resources said in a statement on October 18 that it would begin distributing kerosene in mountainous areas on October 20.

Each qualifying family will be allocated 200 liters of kerosene, which will cost them 100,000 Iraqi dinars ($68). The remaining 65% of the market price will be subsidized by the government.

"Whenever the federal government sends kerosene to the Kurdistan Region, it will be given to citizens at the price set by the federal government," the statement said.

This is the same approach that the KRG used in past years, which resulted in only a portion of families who needed heating fuel receiving kerosene.

The service disparity is acute in places like the Garmian administration, which is located in the western lowlands of the Kurdistan Region. Despite its notoriously scorching summer, winters can be bitter cold if there is no fuel to heat homes.

According to data obtained from the Chamchamal Fuel Authority, which covers part of the Garmian administration, just three barrels of kerosene have been distributed in the district through the government voucher system since 2018.

Chamchamal resident Sakar Mohammed told Peregraf that he had to buy two barrels of kerosene on the open market last yearand that even then it was not simple.

"The [distribution] process is not easy…it is crowded and they will have to put barrels in line for many nights," Mohammed said. "However, there is not enough kerosene and many families cannot get it."

The problem is also evident in the Kurdistan Region’s capital city, where the average temperature in winter months hovers just above freezing.

"Kerosene is distributed annually in Erbil, but it is a small-scaledistribution and distribution is slow," Nafz Nawprdani, head of the Erbil Provincial Council’s Natural Resources Committee, told Peregraf.


Does responsibility lie with Baghdad or Erbil?

The supply of kerosene is one of many points of contention between the KRG and Iraq’s federal government, with Erbil viewing Baghdad at fault for the limited amount of fuel available.

This year, the federal government has promised to send 15 million liters of kerosene to Sulaimaniyah governorate, but it has not yet arrived.

Nawprdani told Peregraf that because of disputes between the two governments “it is the duty of the [KRG] to provide kerosene, which requires a lot of money.

But others say that the KRG should step up its efforts and ensure that its citizens have adequate supplies to heat their homes this winter.

At fuel markets and petrol stations in the Kurdistan Region, kerosene is imported from areas under the control of Iraq’s federal government.

“There are a lot of taxes on it…and the price will go up," SabazHaji Karim, director of fuel trading firm Pola Company, told Peregraf.

Commercial kerosene costs 245,000 Iraqi dinars ($169) per barrel wholesale and retails at 50,000 Iraqi dinars per barrel, but this increases at times of high demand like the winter, according to Karim.

Karim argued that the only solution is for the KRG to refine kerosene itself at the Bazian refinery or those owned by KAR Group. This will result in lower prices, he said.

In the first quarter of 2022, 237,475 barrels of crude oil weresold to local refineries at a price of $54.08 per barrel, according to a report by auditing firm Deloitte.

Sherko Jawdat, a Kurdistan Islamic Union (KIU) lawmaker that sits on the Kurdistan Parliament’s Natural Resources Committee, told Peregraf that "only 74 billion Iraqi dinars hasbeen approved” by the KRG Ministry of Natural Resources to fund kerosene purchases.

"The [KRG] Council of Ministers has been asked to buy kerosene for 320,000 families, out of more than 1.284 million families that need it, which means that fuel goes to a quarter of the families in the Kurdistan Region it needs to and only in themountainous area," Jawdat continued.

"I don't think the government will distribute more kerosene this year," he said, adding that the parliamentary committee supports increasing domestic production of kerosene.