Lebanon's fuel sector in turmoil as exchange rate fluctuations persist

As the exchange rate continues to rise rapidly, gas stations are closing one by one, only to reopen with the release of a new pricing table.

 

However, this problem was discussed in a meeting between importers of petrol companies, representatives of gas stations and fuel distributors, as well as representatives of gas distributors to find solutions.

The participants considered that the ultimate solution is to dollarize the sector, but this requires a decision from the Energy Minister and the government.

Moreover, the Energy Minister is determined to refrain from dollarizing this sector, as it violates the law. At the same time, he allowed citizens to pay in dollars at gas stations if they wanted, according to an exchange rate that will be updated with every new pricing table.
Another solution suggested by the participants is the launch of an electronic platform that allows the exchange of fuel prices to change automatically with the exchange rate.

Alternatively, the Energy Ministry could issue a new pricing every hour.

While waiting for the implementation of these solutions, the participants found a temporary solution that will begin to be implemented in the upcoming days at gas stations after informing the Energy Minister and the Prime Minister of its details.

Maroun Chammas, former head of the Petroleum Importing Companies, told LBCI that the temporary solution in this sector would be to allocate pumping machines whereby customers can pay in dollars at gas stations and allocate other pumping machines whereby customers pay in Lebanese lira. If the dollar exchange rate fluctuates, the machines allocated for payment in the local currency can stop operating. The rest allocated for payments in dollars would still be functional so that both customers and gas station owners minimize their losses.

The lack of a final decision from the meeting requiring the implementation of this solution immediately has caused dissatisfaction among representatives of some unions who considered it unacceptable to wait any longer.

Dollarization has become a reality, but will citizens accept it?