17 longer-than-planned refinery closures for maintenance and repair have frequently led to fuel shortages.

Fuel shortages are far more common when fuel suppliers cannot fully recover costs with reasonable returns and cut back on fuel acquisition and sales, or when they decide to pursue higher-return opportunities elsewhere, such as exports, diversion, and out-smuggling. Shortages have occurred in many countries with artificially low prices, including Argentina, Bangladesh, Cameroon, China, Egypt, Gabon, Ghana, India, Indonesia, the Islamic Republic of Iran, Iraq, Kazakhstan, Malawi, Mozambique, Nepal, Nigeria, Pakistan, Russia, Senegal, Syria, Togo, and the Republic of Yemen.

In extreme cases, oil companies are no longer able to pay to buy crude oil or petroleum products. In Malawi, by early 2011, black-market fuel prices were reported to be more than double official prices. The finance minister told the parliament that commercial banks did not honor letters of credit on time because foreign exchange was scarce (IHS 2011b). Crippling fuel shortages forced rationing and some drivers resorted to parking overnight at filling stations to secure a place in the queue. In July 2011, 19 people were killed and scores injured when demonstrations broke out throughout the country, protesting shortages of fuel and foreign exchange ( _Guardian_ 2011a; AFP 2011b). Nepal’s sole importer, Nepal Oil Corporation, has had difficulties paying Indian Oil Corporation, prompting the latter to withhold delivery and causing fuel shortages. Senegal experienced a prolonged LPG shortage in early 2009, caused by the inability to pay for imports due to mounting subsidies. The shortage doubled the unofficial price of LPG and also pushed up the price of charcoal, which competes with LPG in that market (IHS 2010g; _Global Post_ 2011). By 2011, the Republic of Yemen was no longer able to obtain credit to buy petroleum products on the open market, leading to serious fuel shortages and prompting Saudi Arabia, Oman, and the United Arab Emirates to donate oil ( _International Oil Daily_ 2011; IHS 2010a).

Even when there is no explicit policy of subsidizing fuel prices, disagreement over controlled prices may lead to shortages. In August 2011 in Tanzania, for example, disagreement over price levels prompted oil marketing companies to stop selling and the government threatened to revoke their licenses. The government increased prices 12 days later (Platts 2011f).

Fuel shortages can invite panic buying and hoarding, worsening the shortages. Even when supplies are adequate, rumors or prospects of imminent price increases may prompt panic buying by consumers while sellers hold back selling. If a pricing mechanism is based on an average over a fixed period of time of benchmark world prices and adhered to strictly, it might be relatively easy to predict when the next round of price increases is likely to occur. The Xinhua News Agency (2012a) has partially blamed hoarding by refiners and traders before price increases for fuel shortages. This behavioral response to the price adjustment mechanism is said to be one of the reasons the government of China is reconsidering the current formula.

Where fuel prices are adjusted infrequently, rumors of a price hike could be even more damaging because the public would fear a large price increase. In January 2012 in Egypt, panicked motorists—forming long lines when rumors about a price increase spread—were blamed for serious fuel shortages (AFP 2012a). Consumers fighting over scarce fuel supplies have led to scuffles, injuries, and even deaths (Egypt Independent 2012a, 2012b).

Fuel shortages can get to the point where some consumer groups start asking governments to remove fuel price subsidies. This occurred in Ghana, where the expansion of the