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In SBA areas, incomes of millions of poor households hampered by severe fuel shortages

  • Key Message Update
  • Yemen
  • January 2022
In SBA areas, incomes of millions of poor households hampered by severe fuel shortages

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  • Key Messages
  • Key Messages
    • Levels of remote violence and cross-border attacks have steadily and notably increased since mid-2021 according to data from ACLED and Intelyse. According to the Civilian Impact Monitoring Project (CIMP), the number of airstrikes recorded in Yemen increased by 43 percent in the fourth quarter of 2021 compared to the previous quarter, and armed violence resulted in 956 civilian casualties in the fourth quarter of 2021, representing an 81 percent increase. While many governorates continue to be impacted by conflict, the number of airstrikes by the Saudi-led coalition on Amanat Al Asimah (Sana’a city) has increased notably since late 2021, with even more significant escalation observed in response to the January 18 attack by forces of the Sana’a-based authorities (SBA) on Abu Dhabi. Overall, Marib governorate continues to record the highest number of airstrikes and, in late January, IRG forces re-took Harib and Al Abdiya district in southern Marib.

    • Conflict has badly impacted civilians in January 2021. Civilian property and critical infrastructure—including houses, farms, schools, healthcare facilities, markets, and telecommunications infrastructure—have been damaged or destroyed, with frontline areas and Sana’a city worst affected. On January 21, 2022, a telecommunication center in Al Hudaydah was targeted by an airstrike, causing a complete outage of internet services nationwide. This resulted in a four-day total break in financial services required for trade and remittances near the end of the month when households normally pay back credit used to purchase food. Fighting has displaced around 9,456 individuals from January 1 to 25, 2022, an increase of 73 percent compared to the same time period of the previous year. Many have been displaced multiple times, reducing coping capacity and increasing vulnerability to shocks, with many poor households becoming increasingly reliant on assistance.

    • Between late December 2021 and the first week of January 2022, the Yemeni Rial in areas controlled by the internationally-recognized government (IRG) recovered around 50 percent of its value after peaking at 1,608 YER/USD in early December, according to data from FAO. However, later in January, the local currency resumed it depreciation, likely at least partially due to high market demand for hard currency, and has been trading at levels around 1,100-1,200 YER/USD since the second week of January. Meanwhile, the Sana’a-based Rial has remained stable at around 600 YER/USD for over two years, mainly attributed to strict control measures including banning dealing and trading in newly printed notes, alongside stable foreign currency inflows from exports (including of Qat and vegetables) to IRG areas, humanitarian aid, and remittances.

    • Despite frequent shortages of fuel at official stations in SBA areas over the past year, fuel has until recently remained generally available at commercial stations. However, from January 13, worsening fuel shortages in SBA areas have resulted in the near total closure of commercial stations, ongoing as of late January. This is reportedly attributable to disruptions in fuel supply from IRG areas (which have been providing around a quarter of total fuel market needs in SBA areas) after, in late December, IRG authorities ordered that only the Yemen Petroleum Company in Aden could sell and supply fuel to stations throughout the country. According to key informants, petrol in SBA areas is being sold at 28,000-30,000 YER/20L in the parallel market, more than 70 percent higher than commercial prices. Key informants report that public transportation has been largely unavailable, expected to be impeding many households’ ability to earn income. Meanwhile, prices of vegetables and locally produced crops have reportedly increased due to high transportation costs.

    • In IRG-controlled areas, authorities raised official fuel prices by 26 percent, from 13,200 YER/20L to 17,700 YER/20L, on January 17, 2022. This decision was influenced mainly by renewed currency depreciation, as well as by rising global oil prices and supply shortages experienced by the Yemen Oil Company in Aden. Fuel is required for the provision of public services, including power and water, as well as for many households’ livelihood activities including workshops, small private businesses, and, in rural areas, irrigation of crops. Periods of fuel shortages have become increasingly common in IRG-controlled areas, including in January, mainly due to the government’s inability to provide financial support for imports and manufacturing, as well as due to periodic strikes by Aden Refinery and Oil Company workers. These fuel shortages are challenging already limited income-earning opportunities, further reducing households’ ability to cope with shocks.     

    • Due mainly to the recent currency depreciation, prices of imported foods in IRG areas have increased again, by an estimated 20-30 percent from late December 2021 to mid-January, according to key informants. Prices of domestically produced food items have reportedly increased as well, due mainly to fuel shortages which have increased processing and transportation costs. Though prices remain below peak levels recorded in mid-December, rising food prices will likely drive many poor households to resume severe negative food coping strategies—such as skipping meals—after only slight relief. Meanwhile, in SBA areas, fuel shortages are also driving rising prices of locally produced crops. Even with high levels of food assistance, widespread Crisis (IPC Phase 3) and Crisis! (IPC Phase 3!) outcomes are likely to continue at the governorate level, with worst-affected households likely to face Emergency (IPC Phase 4) or Catastrophe (IPC Phase 5) outcomes.  

    This Key Message Update provides a high-level analysis of current acute food insecurity conditions and any changes to FEWS NET's latest projection of acute food insecurity outcomes in the specified geography. Learn more here.

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