Since 2019, Lebanon has been in the midst of a financial crisis. The COVID-19 pandemic and numerous domestic incidents have radically exacerbated the country’s economic woes, sparking a crisis of confidence in Lebanese leadership. Today, Lebanon is suffering from a major fuel shortage, which has impacted the operation of critical industries across the nation. Despite ongoing sanctions regimes, the Iranian government has recently supported Lebanon by sharing its fuel supply. However, these efforts have done little to relieve the country’s woes.
Lebanon’s ongoing economic crisis was borne out of decades of government corruption and mismanagement. Today, the country’s currency has lost almost 90% of its value, and most Lebanese people are unable to afford basic necessities, including food and fuel. Initially, the government tried to address the crisis by introducing a subsidy system for fuel imports. However, as the financial situation worsened, the central bank could no longer afford to support fuel imports, and the government had to halt this program. Because of this, the price of fuel has risen markedly. This week alone, the Lebanese government has raised fuel prices twice, as the administration has severely rationed fuel supplies. Experts predict that more price hikes are coming.
As the shortage continues, the Iranian regime has worked with Hezbollah, its local proxy, to ship fuel supplies to the crisis-ridden country. According to Prime Minister Najib Mikati, the Lebanese government did not officially approve the shipments, the third of which is in transit. The Lebanese government, however, has done little to impede the smuggling. Government approval of the shipments, which are occurring via an illegal crossing point from Syria, could place the Lebanese government in violation of the U.S. and other entity-imposed sanctions.
Lebanon has also received shipments of fuel from Iraq, which have gone to the state-owned power company. However, Lebanese experts have noted that neither the Iraqi or Iranian shipments have had a significant impact on the state of the fuel crisis.
The situation in Lebanon is dire. As the shortage has worsened, the state-owned power country has only produced minimal amounts of electricity. As a result, businesses and households have become dependent on small, private generators which operate using fuel oil. Recent reports depict massive queues outside gas stations as many stations have closed. Additionally, estimates from this week indicate that most Lebanese citizens now have to pay close to 675,000 Lebanese pounds for enough petrol to fuel a medium-sized vehicle. This is close to the average monthly minimum wage. The price of fuel on the black market has also skyrocketed. As the crisis continues, hospitals, the government, and other integral institutions have been forced to ration power supply and prioritize critical operations. The shortage has also sparked violence and chaos across the country. Last week, armed men attacked a gas station in the Bekaa valley, threatening to kill the owners.
Lebanon is suffering through one of the worst economic crises in contemporary history, sparking a massive fuel shortage, which has impacted the operation of critical industries and resulted in a significant spike in fuel prices. Over the past few weeks, the Iranian regime has attempted to support Lebanon by shipping fuel to the country. Despite this, however, the country’s fuel shortage has continued, with no end in sight.