Gasoline had been subsidized by the Lebanese government, but now it will fluctuate depending on the import cost on a free-market price. The government had supported merchants importing gasoline previously, as well as flour, medicine, and several basic commodities.
The central bank of Lebanon announced as of August 12 that they were ending the fuel subsidy, which has drained the reserves, as the country fell into financial ruin. It is feared that fuel prices will rise perhaps four times the prior subsidized price. The World Bank has said Lebanon is suffering one of the biggest depressions in modern history.
Prior to this decision, the central bank had been extending subsidies for fuel imports at a rate of 3,900 Lebanese Lira (LL) to the dollar, while the parallel black-market rate is more than 20,000 LL on Wednesday. The central bank's reserves have plummeted from more than $40 billion in 2016 to $15 billion in March.
The decision drew criticism from former Foreign Affairs minister Gebran Bassil. "The president, the government and the people must prevent the implementation of the conspiracy," he said on Twitter. Bassil said in a press conference that there is an economic war being waged against Lebanon, and Salameh is one of those who are implementing this war.
The US has exerted pressure on Lebanon, in the form of an economic war, which is designed to put pressure on the resistance to the occupation of Lebanon and Palestine.
Patriarch Boutros al-Rahi said he is asking the Lebanese government to prevent the launch of missiles from Lebanese land towards Israel, because the people are tired from war and destruction. But, he did not ask to protect Lebanon from Israeli aggressions, and the occupation of Lebanese territory at Shebaa Farms.
The Lebanese ruling elite are carrying out the US agenda by not importing gasoline from the east; places such as Iran, Russia, and Iraq. The US and Saudi Arabia are not selling any gasoline to Lebanon, and are preventing Lebanon from buying from the eastern countries. The Lebanese resistance leader, Hassan Nasrallah, said in a speech that if the Lebanese government fails to provide gasoline and diesel fuel to the Lebanese people, then the resistance will provide it to the people through Iran, and no one can prevent them from doing so. Media reports out in last 24 hours reported that part of the oil promised by Nasrallah began to arrive in tankers from the Syrian-Lebanese border.
Gas stations have witnessed long lines and violence occasionally, and most people have experienced extended blackouts as diesel becomes scarce, even for hospitals.
Hunger
Many Lebanese struggle to buy food at the hyperinflationary prices, as the LL collapsed over 90% in the past two years. For example: buying a kilo of chicken, soap, fruit, and sandwich makings can cost the equivalent of the average monthly salary in Lebanon.
Lebanon went from what could be described as a middle-income country into one of the worst economies in the world in the span of a year and a half.
Lebanon ended a 15-year civil war in 1990, and the economy experienced an upswing in the aftermath. Beirut regained its nightclubbing, party atmosphere, and tourists from the Persian Gulf and Europe came back again.
But, the inequality was stark, with the rich being very rich, and the poor being very poor. However, hunger was not a prevalent issue, until now.
Bank Governor Riad Salameh
The Lebanese central bank regulates Lebanon's banks, loans the government money, oversees monetary policy, and for almost three decades has been headed by a former Merrill Lynch banker, Riad Salameh, who instituted the peg. He decreed that one US dollar would always be equal to about 1,500 LL. Since Lebanon survives on imports, this made it easy for Lebanese importers.
The problem was keeping a big supply of dollars because the economy depends on dollars.
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