Fuel prices soar by a third in Lebanon

Lebanon’s government reduced subsidies as deliveries partially resumed

Lebanon’s government raised fuel prices by more than a third on Tuesday as subsidies were reduced.

Fuel deliveries to petrol stations across Lebanon partially resumed.

The move followed worsening gasoline and diesel shortages that have forced motorists to queue for hours at petrol stations across the country and private generators to reduce their power supplies, plunging many areas across Lebanon into darkness for hours.

Fadi Abou Chakra, head of the Lebanese fuel distributors' association, said fuel was being delivered to petrol stations on Tuesday after the unloading of six fuel shipments began late on Monday.

The new deliveries will reach consumers at a significantly higher price, with 20 litres of gasoline costing 61,100 Lebanese pounds ($39), up from 45,000 Lebanese pounds ($29), according to a price list released by the National News Agency on Tuesday.

The new fuel shipments are being financed by the central bank at a rate of 3,900 Lebanese pounds to the dollar instead of the official exchange rate of about 1,507. But the new rate remains well below the market rate of 17,000 pounds to the dollar, with the national currency having lost over 90 per cent of its market value since Lebanon’s worst economic and financial crisis in decades began in late 2019.

The crisis, which has plunged over half the population into poverty, has fuelled sporadic protests across the country and sparked scuffles and gun fights at gas stations as motorists try to fill up their tanks.

Lebanon’s Higher Defence Council ordered security forces to remain alert to maintain order and security ahead of the summer season, which officials hope will draw Lebanese expats and tourists and provide a much-needed boost to foreign currencies entering the crisis-hit country.

The economic and financial crisis was compounded by the massive Beirut port blast that killed over 200 people and destroyed thousands of properties across the capital last August. The blast forced caretaker Prime Minister Hassan Diab’s resignation and has since left Lebanon without a fully functioning cabinet.

Updated: July 1st 2021, 7:35 AM
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