Lebanon’s Fuel Crisis: A New Test and Low Hopes
Arab World
Beirut - Ali Zeineddine
Starting on Monday, consumers in Lebanon will know whether the new government approach to deal with the fuel crisis would help them secure their daily needs of oil derivatives, amid general frustration with the official response to the intractable life problems that are exacerbating at a record speed. Apart from the political dimension in estimating the fictitious profit for some and the confirmed losses for all, well-informed sources ruled out serious improvement in the availability of gasoline and diesel, despite the decision to double retail prices. In fact, the new prices are still very attractive and correspond to about a third of the price approved in Syria, whose markets are a destination for smuggling operations along the borders in the Bekaa and North. Basically, the banking sources noted that the real price of a canister of gasoline (20 liters) is about USD 12, which is equivalent to LBP 250,000 based on the current dollar price in the parallel market. With the adoption of a new pricing of less than USD 7, up from about USD 3.9 (according to the decision taken at a presidential palace meeting on Saturday), the load of one tanker would achieve an average profit of more than USD 5,000 if it is smuggled or hoarded. The attractive profit equation applies more clearly to diesel, as consumers reported that the price of a ton (1,000 liters) has reached in recent days between 20 and 25 million pounds, which is equivalent to more than a thousand dollars in cash. Thus, the price of the canister has realistically increased to between USD 20-25, compared to about USD 5 for the new price, and less than USD 3 for the previous price. These differences are in fact very attractive to crisis dealers, especially with the scarcity of the dollar in the Lebanese markets, and the alarming deterioration in value of the Lebanese pound.
from Asharq AL-awsat https://english.aawsat.com/home/article/3147466/lebanon%E2%80%99s-fuel-crisis-new-test-and-low-hopes
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