What is the price of a litre at the pump made of?
The number on the station totem looks arbitrary. It is not: it is a stack of four layers — crude, refining, logistics, taxes — each telling part of the country’s economic story.
Every driver knows the number displayed in large figures on the station totem. Almost nobody knows what it is made of. That is a pity, because this price is one of the most instructive economic documents in the country: it tells where the energy comes from, which route it takes, and who levies what along the way. Let us break it down, layer by layer.
Layer 1: crude — the raw material
Everything starts with the barrel. A barrel holds 159 litres; divide its price by 159 and you get the cost of the raw material inside your litre. With crude around 80 dollars, the raw material alone weighs roughly half a dollar per litre — before any refining or transport. This is the layer nobody controls: it is set on a world market, at the mercy of geopolitics and demand. A producing country that exports its crude sells this layer; a fuel-importing country buys it back — transformed, transported, and therefore marked up.
Layer 2: refining — the transformation margin
An engine does not drink crude. Between the barrel and the litre of gasoline stands a refinery, and its work has a price: the refining margin, the spread between the crude going in and the products coming out. It swings widely with the cycle — a few cents per litre in quiet times, far more when capacity is short. Whoever does not refine at home pays this margin to someone else’s refinery, often thousands of kilometres away.
Layer 3: logistics — the landlocked layer
This is the layer Chad knows best, at its own expense. An imported litre typically travels 1,700 kilometres up from the coast: ship, port depot, then truck over long and sometimes difficult roads. Freight, handling, storage, losses, financing of stock in transit: every link adds its cost, and landlockedness can make logistics one of the heaviest items in the Chadian litre — far more than in a coastal country. It is also the most fragile layer: one closed border or cut road, and the price no longer rises, it vanishes — that is a shortage.
Layer 4: taxes and regulation
Almost everywhere in the world, fuel carries taxation: duties, excise, VAT. That is legitimate — the roads the trucks use must be paid for — and it is also a policy instrument: many states, including in the Sahel, administer pump prices to smooth out market swings and protect households, subsidising in the troughs and recouping in the peaks. The fiscal layer is the only one decided entirely within the country.
What integration changes
Read the four layers again: the first must be endured, but the other three depend on the geography of the chain. Producing crude in Chad removes the buy-back of layer 1 at world prices plus transport; refining close to the fields — the bet of the modular mini-refinery — keeps the refining margin in the country; distributing over short circuits from national depots compresses the logistics layer, the one most inflated by landlockedness. That is EnerTchad’s whole thesis: each layer of the litre’s price is a trade, and every trade brought home is value that stays in the country. The pump price does not become magical — crude will remain global, taxes will remain sovereign — but every franc in the litre then works in Chad, instead of paying for someone else’s chain.