Shell considers withdrawing from Zimbabwe

Observer/Guardian:

Shell was considering pulling out of Zimbabwe last night amid claims that President Robert Mugabe was reserving the distribution of fuel at petrol pumps for party supporters.

A source at the oil giant told The Observer it was looking at a plan to halt activities in the country, which are overseen in a joint deal with BP. One option being canvassed is for Shell to sell its stake to a third party....

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Shell and BP supply 74 independent petrol stations in Zimbabwe. Supplies are piped from Mozambique and stored at four oil terminals. Both companies have bitter memories of the hostility they drew during the apartheid era in South Africa and minority rule in Rhodesia.

The political instability since last month's rigged presidential election was one factor under consideration by Shell, the source said. 'We have withdrawn from countries in the past where the situation was delicate,' he said. 'We are actively looking for a new solution.'

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Shell would become the fourth company to pull out of Zimbabwe in the past fortnight. Tesco announced last week that it would stop sourcing products from Zimbabwe as long as the political crisis persisted. The London mayor, Boris Johnson, promised that Oyster card supplier EDS would not renew its contract with the Munich-based company Giesecke & Devrient, after it emerged that the company provides banknotes to Zimbabwe's central bank. The communications company WPP said it would divest its quarter stake in Y&R advertising agency since it emerged that a senior member of the company's management was advising Mugabe.

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The story offers no explanation of why BP is not pulling its business. You would think that with all of the political pressure coming from London they would feel before a Dutch company like Shell. Since Mugabe's thugs are controlling the distribution of the fuel, they would be the only ones hurt by such a withdrawal.