Jul 21 2020 - 05:41

The lie of diesel smuggling to Syria-al-Akhbar newspaper

For the past few months, the local market has been flooded with rumors Lebanon, news ,lbci ,أخبار Diesel, Lebanon,Syria,For the past few months, the local market has been flooded with rumors
The lie of diesel smuggling to Syria-al-Akhbar newspaper
Lebanon News
The Lebanese al-Akhbar daily published on Tuesday an article under the title of: "The lie of diesel smuggling to Syria" saying that "for the past few months, the local market has been flooded with rumors about diesel smuggling to Syria. Many tales were told about the depletion of BDL’s reserves and the wide-open borders right under Hezbollah’s nose... But the coincidence alone revealed that these lies happened to be told at the same time as the "collapse" of the fraudulent fuel gang: ancient political houses with local and international dealers, and local competitors. They took their share of the market through the adulterated fuel, but diesel has become their primary focus to eliminate competitors by inciting the Americans against them."

The newspaper added that the “story of diesel smuggling to Syria was proven to be untrue by the Lebanese customs figures, which indicate that the import of diesel in the first six months of the current year decreased compared to the same period in the past years, and therefore the claims of such smuggling are not accurate. In the first six months of 2020, Lebanon imported about 1.25 million tons of diesel, compared to 1.38 million tons in 2019 and about 1.4 million tons in 2017. This means that the average daily diesel consumption in Lebanon decreased from 10.2 million liters per day in 2017 to 10.1 million liters per day in 2019, reaching 9.12 million liters per day in the first six months of this year."

"The low amount of imported diesel does not leave many choices; This means that consumption is shrinking, or that there are obstacles that prevent importing the needed quantities. The reality may not be related to the coronavirus and the decrease in economic activity that resulted from the lockdown between February and May. In fact, life did not stop completely in light of the coronavirus lockdown, but rather large sectors continued to work almost normally, perhaps more than usual. The most prominent sectors consuming diesel include: the neighborhood generators sector, which kept operating and consuming diesel, hospitals did not close their doors, and ovens continued to supply bread while food manufacturers as a whole, kept working... It is true that restaurants and hotels were closed, but does this justify the decline in consumption from year to year and the specific accusations of smuggling to Syria against certain companies?," the article went on by saying.

The daily also said that "on that day, it was said that Syria was taking advantage of the Lebanese diesel which was paid for in hard currency from the reserves of Banque du Liban, amounting to 400 million dollars by taking advantage of the difference between its price in Lebanon (in April it was 10,000 LBP and it rose today to 16,300 LBP) and the price of diesel in the Syrian market, which is sold for the equivalent of 20,000 Lebanese pounds. It was also said that Hezbollah was controlling the borders and organizing the smuggling of diesel and other commodities."

"Practically, smuggling from Lebanon to Syria is very costly. All the diesel that comes to Lebanon is pumped from the ships that deliver it in tanks on the Lebanese coast. Consequently, the cost of transporting it from the coast to areas close to smuggling zones exceeds 2,000 LBP per plate. According to a diesel trader: “The cost of transporting a truck (Cistern that can accommodate about 20 thousand liters or 1,000 plates) of diesel from Beirut to Baalbek amounts to two million LBP. So, if someone wants to smuggle diesel, they will have to pay a cost of more than 7,000 LBP because the distance from Baalbek for example to the zones in Syria is relatively long, not to mention that the smuggling also has its costs.” The trader therefore explained that it is not possible to make easy money from smuggling when the price of diesel in Lebanon was 10 thousand pounds, while the cost of smuggling in light of today’s diesel prices causes great losses and cannot be done. “It would rather be more appropriate and feasible to sell the diesel in the local black market. Just yesterday, the price of the plate reached 30,000 LBP, compared to 24,000 LBP a few days ago, which means that the difference between the official price and the black-market price amounts to 13,700 LBP per plate, including the transport cost!," it added.

"Add to these factors a fundamental issue that has arisen in the past two months: The production of the power plants in Lebanon has decreased to supply limits of between two and four hours per day only. Therefore, the demand for diesel from neighborhood generators significantly increased because their owners have started operating their generators for 20 to 22 hours per day as a maximum. They are forced to reach the maximum production capacity because most subscribers have moved from the fixed price subscription system to the meters-based subscription system, and the only way for generator owners to make any profits is to operate their generators. The increased demand on generators made up for any consumption shortfall caused by the coronavirus.There lies the fundamental question: Why did EDL resort to this harsh rationing? Practically speaking, this rationing resulted from the unveiling of the fraudulent fuel gang and the arrest of a large number of its members. Regardless of their known names, these gangs controlled the import of fuel and sold it to EDL to operate the power plants. The members of this gang are dealers working as intermediaries with the Algerian company Sonatrach, with which Lebanon signed a state-to-state contract to import fuel. These traders have political affiliations, men working for them, former partners, and competitors, and they also have local and international ambitions in the oil market and in other fields," the al-Akhbar also said in its article.
The daily concluded by saying that "at the moment when the gang was exposed and their names became known to everyone, a political-mafia action was started to launch accusations at anyone trying to import diesel into Lebanon to cover the market’s demand, as if it were intended to publish a rumor about the extent of the damage that the market would incur if the gang members remained under arrest and under conviction. This campaign did not stop there. Rather, the gang's interests were intertwined with that of some people in power who sought to topple the government and incite people against it.Notwithstanding the evaluation of this government and its work, the oil importing companies also participated in launching accusations against a competing company that imported diesel to cover the demand. Each of them has goals and objectives that led them to attack the same company in order to snatch its share of the market. If they were able to motivate the Americans (the US Treasury) to place this company with its assets and subsidiaries in Lebanon and abroad on the OFAC list or under any of the laws applicable against Syria such as Caesar and Magnitsky, they would have the opportunity to expand the local sales market. There are also political players in this sector from the north to the south, to the mountain ranges. They are the head of the gang that should be arrested and thrown in jail."
To read the full article in Arabic, please click here
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