June 26 (Bloomberg) -- Emirates National Oil Co., a Dubai- based refiner and gasoline retailer, shut filling points in the neighboring sheikhdom of Sharjah after running short of fuel at service stations across much of the United Arab Emirates.
At least four stations in Sharjah run by ENOC, as the refiner is known, were barricaded yesterday to prevent customers from entering. Other gasoline retailers in the emirate were open and serving customers. A spokesman for ENOC didn’t answer a telephone call to his office seeking comment today.
Sharjah’s governing Executive Council ordered the company last week to resume supplying fuel to stations there, giving it until June 21 to comply. ENOC said June 7 that upgrades to service stations were causing shortages at some of its ENOC and Eppco brand filling points.
Retail prices for gasoline and diesel in the U.A.E. are fixed below market levels by the federal government, and they don’t reflect short-term fluctuations in the market for oil or refined products. ENOC said May 1 it may have to spend 2.7 billion dirhams ($740 million) this year to cover the cost of selling fuel at fixed prices. The company said it spent 1.5 billion dirhams in 2010 to cover the gap between its cost of raw materials and the price the government let it charge for fuel.
Regular gasoline sells nationwide for a state-mandated price of 1.72 dirhams per liter, or $2.44 for about a quarter of a gallon.
ENOC stations in the U.A.E. emirates of Sharjah, Ajman, Ras Al Khaimah, Fujairah and Umm al-Quwain have faced supply shortages over the past month. The company’s stations in Dubai continue to sell fuel, and it has no filling points in Abu Dhabi, the U.A.E.’s capital and the largest of its seven emirates.
Abu Dhabi holds almost all the nation’s oil reserves. Fuel in Abu Dhabi is sold exclusively by Abu Dhabi National Oil Co., which serves all of the country’s emirates except Dubai.
ENOC needs oil prices at about $45 a barrel to break even on gasoline sales, Chief Executive Officer Saeed Khoory said in a January 2010 interview with local newspaper Al Ittihad. Crude traded at more than $100 a barrel yesterday after the Organization of Petroleum Exporting Countries, of which the U.A.E. is a member, failed to agree to raise production.
--Editors: Bruce Stanley, Alastair Reed
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