Seven filling stations in Ulaanbaatar, numbers 1, 2, 3, 13, 39, 42 and 43 in the Sod Mongol network, stood closed in the weeks when the city counted petrol by the liter. The Anti-Monopoly Office now says the company's tanks held AI-92 all along, and that it can find no clear reason the fuel stayed there.
Its citation is article 10.2(7) of the Law on Violations, and the statute has a name for what it suspects: "creating an artificial shortage of goods, works or services by misleading consumers." The inspection runs under the emergency headquarters the prime minister stood up on August 3, and the industry minister leads the working group himself. The company had said nothing in the wires by Thursday. Nothing is proved.
Consider the month around it. Ulaanbaatar spent early August rationing petrol by purse and by plate: a 50,000-tugrik cap per visit, purchase days matched to plate parity. The pump price moved once, on August 11, up 200 tugriks to 3,040 a liter, about $0.85. Food prices were running 25.5% above last July; the central bank answered mid-month with an emergency half-point hike. The ration ended with the weekend of August 15 and 16. The queue thinned.
Two other warehouses spent that month holding their stock. The Price Council, the body that exists to rule on fuel prices, has not met all crisis; no session has surfaced in the official feeds. Its regulatory inventory sits intact. Unopened, in mint condition.
And the industry ministry itself warned on August 17 that importers were out of cash and another 200-tugrik rise was unavoidable. Ten days on, the unavoidable has not arrived. The price has sat at 3,040 since the 11th, while the ministry now counts 49,000 imported tons for the month, 56 fresh wagons carrying 3,000 tons, and stocks of 20,504 tons in the capital against 12,207 in the provinces, supplied to about 1,500 stations around the clock. The importers' cash, on the ministry's August telling, had run out; the tanks, on the regulator's Wednesday telling, had not. Somewhere between the warning and the warehouse, the arithmetic stopped being done in public.
The law's difficulty lives exactly there. An artificial shortage, in the statute's language, needs deception; a natural one needs only a frozen price meeting a rising cost. The same closed pump can mean a seller out of product or a seller waiting for a better price, and telling one from the other after the fact is the hardest exercise in competition law. Regulators everywhere know the trap: punish the warehouse and you teach sellers to run empty; ignore it and you teach them that a queue is a pricing instrument.
“Emergency headquarters are temporary; case files are not”
This is an old case file. In July 1973 the US Federal Trade Commission accused the country's eight biggest oil companies of restricting the supply of refined product; within months, American drivers were buying petrol by plate parity too, odd numbers one day, even the next. Its staff believed the shortage had help; proving that in hearings was another life's work. The queues passed. The case did not pass with them: it crawled through 8 years of proceedings and was abandoned in 1981, having established neither the shortage's artifice nor its innocence.
That rhyme flatters nobody. Stocks are always somewhere, and hindsight always says they should have been at the pump. What Mongolia's office has that the FTC lacked is scale in its favor: seven stations, one company, one month, tank records an emergency headquarters can demand tomorrow morning. What it shares with the FTC is the clock. Emergency headquarters are temporary; case files are not.
The queue in Ulaanbaatar now has a suspect. Most queues never get one. Fifty-three years apart, the two files share a vocabulary: withheld supply, misled consumers, queues with numbers on their plates. Both stories teach the same lesson: artificial or natural, the queue looks identical from inside it. What differs is whether the state can afford to establish which kind its citizens stood in, and how long it keeps paying attention once they no longer are.
Peter Lidovsky writes on Eurasia and the politics of the spaces between empires. He contributes a weekly column to Central Asia Wire. The views expressed are his own.