In Yemen, attacks fuel economic collapse

Over months of political turmoil, attacks on electricity plants and oil pipelines have left Yemen’s economy on the edge of collapse, with the most damaging strike carried out in retaliation for a U.S. counterterrorism raid.

Against a backdrop of street protests and military clashes, the country is grappling with electricity blackouts, rising food prices and fuel shortages so dire that ordinary Yemenis can spend days in lines for gasoline.

In March, tribesmen blew up the main pipeline in Marib province, the legendary birthplace of the Queen of Sheba and home to roughly half of Yemen’s oil reserves. The attack was carried out by a powerful tribal leader, Ali al-Shabwani, whose son was killed in a U.S. airstrike in May 2010.

The pipeline funnels crude to the nation’s main oil terminal in the southern port city of Aden for export and to be refined into gasoline. With Yemen bogged down in a popular uprising, the pipeline remains ruptured, with Shabwani and his heavily armed tribesmen refusing to allow the government access to the site until he gets justice for the airstrike, Yemeni officials said.

Around this sprawling, dun-colored capital nestled among jagged mountains, the consequences are apparent, including water shortages, high transportation costs and soaring food prices — posing great hardships in a nation where 40 percent of the population lives on less than $2 a day.


Lines stretch for miles at gas stations that sell fuel at government-subsidized prices. On the black market, fuel costs three times as much. At some gas stations, gunfights have erupted.

“The sheik has no right to do this,” said Yahya Saleh Mohammed, 27, an accountant in Sanaa. He had been waiting in line for gas for two days in his green SUV; he was still a mile away from the gas station, a wait that he estimated would take one more day.

“Yes, [Shabwani] has suffered from the airstrike, but how can he make all the people suffer?” he said.

Many restaurants and stores are shuttered. Beggars have multiplied. At night, large portions of Sanaa are enveloped in darkness; electricity is available only for a few hours a day. The attacks on power plants and pipelines have continued, carried out from both sides of a widening political divide.

“Initially, these were anti-government tribes who wanted to place pressure on the regime,” said Adil Abdul Ghani, an official in the Electricity Ministry. “Now, however, they are pro-government ones attacking the plants because they want to show that the state cannot function without Ali Abdullah Saleh,” the longtime president.

‘Everybody is lost’

The contributing role of the U.S. airstrike in the fuel shortage is an indication of the growing fragility of Yemen’s economy during the five-month-old revolt. It also highlights the potential for U.S. policies to have harmful, if unintended, consequences in this politically brittle nation, where Washington has stepped up counterterrorism activities in recent months, with plans for the CIA to work closely with the Joint Special Operations Command in carrying out attacks with armed unmanned aircraft.

Many Yemenis also view the economic crisis through the prism of politics, blaming the government or the opposition for their woes. That, many analysts and diplomats fear, could spawn more unrest; rising unemployment and poverty could drive disaffected youths toward militancy at a time when al-Qaeda in the Arabian Peninsula and other Islamist extremist groups are trying to take advantage of Yemen’s political vacuum.

“Everybody is lost,” said Saif al-Asali, a former finance minister. “And the politicians on both sides don’t seem to care what happens to the people.”

Saleh’s supporters say the Joint Meeting Parties, a coalition of six opposition groups, is attacking the electricity plants as well as blocking roads to prevent trucks from hauling oil to cities and plants.

“We know these are terrorist groups with links to the JMP,” said Abdul Basat al-Kumaim, an official with the Ministry of Industry and Trade. “They know they can’t take power democratically, so they want to steal the power through destructive actions. They want to show that the government is not able to regain control.”

Revenue stream dries up

Hisham Sharaf Abdalla, the minister of industry and trade, said the economy has lost $4 billion to $5 billion since February, roughly 16 percent of the nation’s nominal gross domestic product. The bulk of the losses comes from deep cuts in the production and export of oil, which had provided 60 percent of Yemen’s income.

Some of the drop-off in production was caused by oil companies’ decisions to withdraw employees from Yemen. But the major culprit, say Yemeni officials and diplomats, was the March attack on the pipeline, which carries crude from Marib to the Red Sea port of Salif; from there, it is shipped to the refinery in Aden.

In addition to supplying local gas stations, Yemen’s oil industry had produced enough to allow exports of 120,000 barrels a day, serving as a vital source of foreign currency. Yemeni officials said the nation has lost $1 billion in oil revenue since the pipeline blast. Another refinery in eastern Hadramaut province continues to export oil.

Ripples of an airstrike

The March attack was in retaliation for events that unfolded May 25, 2010, as Jaber al-Shabwani, the deputy governor of Marib, was meeting in a remote desert location with suspected al-Qaeda in the Arabian Peninsula operatives.

The younger Shabwani, who was killed in the airstrike, is not thought to have been an intended target of the raid; there is no indication that he was an al-Qaeda member, and associates said the purpose of the meeting was to persuade the operatives to defect. Shabwani’s father had been an influential ruling party member but joined the political opposition before carrying out the March attack.

“He blames the government and security forces for killing his son,” said Sultan al-Arada, an influential tribal leader in Marib who knows the elder Shabwani. “He wants to know who authorized the airstrike.”

The government is unable to even head up to Marib; the road between the capital and Marib is controlled by a web of tribes. If the government tried to enter Marib by force, Yemeni officials said, it could lead to a tribal war.

Yemeni officials remain angered by the episode, saying that they were not given advance notice of the U.S. raid. They say Shabwani has demanded $5 million in blood money as well as a face-to-face meeting with U.S. Ambassador Gerald M. Feierstein to demand an explanation.

“He’s taken a very extreme stance,” said Abdu al-Janadi, Yemen’s deputy information minister. “He won’t let us fix the pipeline until the Americans admit to him that they are the ones who carried out the strike. And he wants to know which Yemeni official authorized the strike.”

“The Americans are the main reason for this crisis,” Janadi added. “They killed Shabwani’s son.”

Sudarsan Raghavan has been The Post's bureau chief in Africa since 2010. He began his career as a foreign correspondent in Africa, and covered the Iraq war as Baghdad bureau chief.
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