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Fuel prices rise in Lebanon as subsidies phase out

i24NEWS

clock 2 min read

A general view shows the ravaged port of Lebanon's capital Beirut, on September 14, 2021.
Joseph Eid/AFPA general view shows the ravaged port of Lebanon's capital Beirut, on September 14, 2021.

An official explained that the high prices reflect an exchange rate of 14,000 Lebanese pounds to the dollar

Lebanon raised it's fuel prices for the second time in a week following government attempts to phase out the nation's subsidy system. 

Prices shot up 16 percent on Wednesday, after an initial escalation of 37 percent on Friday. Analysts predict the increases will likely continue over coming weeks.

The changes are a result of official efforts to replenish Lebanon's cash reserves, which critics say were drained by the process of providing dollars to fuel importers at heavily subsidized rates, according to Reuters

A representative from Lebanon's energy ministry explained that the high prices reflect an exchange rate of 14,000 pounds to the dollar. The exchange rate in 2019, before the country's economic crisis, was 1,500 to the dollar.

Nearly 80 percent of the population is reportedly living below the poverty line as the country's new leadership attempts to navigate out of financial ruin. 

Lebanon's currency has lost over 90 percent of it's value since 2019, and the World Bank called the situation there the worst since the mid nineteenth century. 

Last week, Iranian oil shipments arrived in the country as part of an operation spearheaded by the Lebanese faction Hezbollah. Lebanon's new prime minister, Najib Mikati, has said the delivery was 'not approved' by his government. 

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