Lebanon's fuel crisis intensifies

Lebanon remains immersed in a deep economic crisis that predicts industrial and agricultural disaster for the natio
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AFP/ JOSEPH EID  -   Vehicles queuing for fuel at a petrol station in Beirut, capital of Lebanon, on June 11, 2021, amid severe fuel shortages.

The economic, political and social crisis continues to grip Lebanon. The country, hit by the collapse of the economy, the exhaustion of the political system, the consequences of the war in neighbouring Syria and the coronavirus crisis, is trying to stay afloat in a bleak context.

Last April, the increase in the price of petrol by 100 dollars caused widespread social discontent. Residents took to the streets to protest against a system that remains unsustainable. As a result of the government's plan to reduce prices, basic goods have seen their prices rise and serious electricity crises have kept the country in darkness for long periods of time.

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AFP/ JOSEPH EID - Vehicles queue to buy fuel at a gas station in Lebanon's capital Beirut on June 11, 2021, amid severe fuel shortages.

In recent days, long queues of people waiting outside petrol stations have continued to dominate the scene in Lebanon, which continues to witness shortages of medicines and other basic commodities. In this line, platforms on different social networks have spread that the price of oil "could be reaching LBP140,000 ($93) according to the exchange rate of the dollar on the black market and the price of oil barrels at the moment".

The head of the fuel companies' workers and user’s union, Wali Dib, warned that "the oil and gas sector is approaching collapse next week when the companies' reserves are expected to run out". Similarly, Wali Dib criticised the political management, stating that "those responsible for the crisis are not taking decisions to put an end to this situation".
 

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PHOTO/DALATI NOHRA/REUTERS - Lebanon's President Michel Aoun

Oil shortages over the past week have led to the closure of a number of petrol stations and have frightened the population about a possible return to rationing and insufficient resources. The gas station owners' union has urged the government and the Bank of Lebanon (BDL) to, "clearly announce their policies in this sector and be frank with us and the people about what they really want to do".

Oil importers have already asked to cancel petrol subsidies amid rationing transfers by the BDL that have reduced the monthly number of electricity-generating ships from four to one.

Lebanese deputy Michael Daher, who has already predicted the crisis of the economic model in 2012, has expressed his fear that the fuel crisis will lead to the collapse of the agricultural and industrial sector, as the lack of fuel prevents farmers from carrying out their work activities. 

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PHOTO/REUTERS - Protest, after the Central Bank of Lebanon said it would stop bank withdrawals from dollar accounts at a low fixed rate, in Antelias, Lebanon 3 June 2021.

Furthermore, the measures taken by the financial institutions, which more than a year ago announced a de facto "corralito" that has prevented people from withdrawing money from cashiers after the closure of many offices, must be added to this. If we add the consequences of food shortages in the face of high demand and monetary shortages, the country's middle class has disappeared. According to the World Bank, half of the population was living below the poverty line before the Beirut explosions.

Last March, Lebanon declared bankruptcy and officially declared the first debt default in the country's history. 

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AFP/AFP - Factsheet on the Lebanese economy

Alongside the oil crisis, the political crisis remains one of the main unresolved issues in the country. Talks on the formation of a future government remain deadlocked, and the acting president himself, Michel Aoun, has repeatedly stated that if the current acting prime minister, Saad Hariri, fails to form a government, he should submit his resignation.

Lebanon's political system, characterised by a system of quotas, governed by 18 religious communities that have shared power for decades, has shown signs of exhaustion, which demonstrate the unsustainability of maintaining in power the political elites that have been implicated in several cases of corruption and perpetuate sectarianism. Columnist Sarkis Naoum told Reuters that, despite the political change following the 2019 demonstrations, politicians "govern the country with the mentality of a militia, corruption, tyranny and sectarianism". This situation continues to bring echoes of change, but the founder of the website "Beirut report" told Al-Jazeera that "it is easy to talk about revolution, but our problems are structural and deep, with political loyalties forged over decades and people willing to give their lives for their leaders".
 

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PHOTO/AP - In this 5 August 2020 file photo, smoke rises after an explosion the previous day at the seaport in Beirut, Lebanon.

On the other hand, as a result of the Syrian war, more than 1.5 million Syrians have taken refuge in Lebanon, making the country the state with the highest number of refugees per capita in the world. The influx of refugees has overwhelmed health and hospital systems, as well as electricity and water sanitation services. The results show that the efforts of NGOs have not been sufficient and that the meagre international assistance from institutions has been limited.

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PHOTO/AP - A man rides his bicycle past rubbish bins set on fire by protesters blocking a main road in front of the Central Bank of Lebanon building.

Lebanon continues to live in the midst of a multilateral crisis that is affecting the civilian population on all sides. Insufficient international aid and internal difficulties in managing the country continue to aggravate a tragic situation that requires solutions. If the regression continues incessantly, the Lebanese population will continue to suffer the economic consequences of a crisis that has already increased poverty by more than half of the population and which, added to the health crisis, is making it difficult for a country on the verge of proclaiming itself a failed state to emerge from recession.