Prices of hydrocarbon derivatives see total chaos as lira plunges

Lebanon Economy
2023-01-25 | 08:29
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Prices of hydrocarbon derivatives see total chaos as lira plunges
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Prices of hydrocarbon derivatives see total chaos as lira plunges

The prices of hydrocarbon derivatives are witnessing total chaos in Lebanon as the Ministry of Energy is battling the daily increase in the dollar price on the black market.

The price list for hydrocarbon derivatives on Tuesday morning was based on the exchange rate being 53,000 Lebanese lira to the dollar. Still, when it rose to 55,000 Lebanese lira on Tuesday evening and 56,000 Lebanese lira on Wednesday morning, the stations announced a halt to sales, a move that gas distribution companies also made.
 
With the release of a revised price list at noon on Wednesday, based on the exchange rate of 56,000 Lebanese lira to the dollar, the issue appeared to have found a solution. Still, it didn't take long for the dollar's value to rise to 56,500 Lebanese lira.
 
The stations followed the Ministry of Energy pricing on Wednesday. Following discussions among the concerned parties, it was decided to publish a daily price list for fuel prices in the morning, accounting for the real exchange rate. However, this solution is jeopardized by the rapid fluctuations in the exchange rate.
 
Those in charge of the gasoline file are now debating several alternatives; including creating a platform that sets the fuel price faster than the price list and at levels consistent with the dollar's changes.
 
But information indicates that this platform still needs to be ready and requires more studies.
 
One of the suggested solutions is to dollarize the price of gasoline, with the condition that consumers pay in Lebanese pounds at the going rate.
 
However, according to the Ministry of Energy sources, this issue requires a bill passed by Parliament, and efforts are being made to find a legal way to carry out this solution.
 
According to the sources, publishing multiple daily pricing lists is one of the alternatives that have been suggested. However, it has yet to be decided upon.
 
The only viable option for this ongoing issue is a daily pricing list that accounts for dollar fluctuations until a radical solution is found. 
 
Will this short-term fix be effective in shortening the queues of Lebanese at filling stations?
 
 

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