Malawi has sold gold from its international reserves and asked Afreximbank for a $120 million loan to fund fuel purchases, the Nation Publications media group reported on Wednesday, citing information minister Shadric Namalomba.

Namalomba said the Iran war had worsened a shortage of foreign exchange in the Southern African country. Fuel suppliers were demanding cash payments, he told the Nation.

"We have sold some of the gold that RBM (the Reserve Bank of Malawi) stocked and taken (a) portion of the forex from the sale of gold to pay $30 million so that we have fuel collected from the ports," the Nation quoted Namalomba as saying.

Namalomba said the government was expecting Afreximbank to release $120 million within a week to help ease stockouts.

Long queues

Malawi has, in recent years, experienced frequent fuel shortages, and they were a major issue at last year's election.

The situation had improved under President Peter Mutharika, who won September's vote, but the Iran war has seen queues return at petrol stations.