The “straw” of Iranian fuel “crushes” the back of the economy, does not recycle the electricity July 29, 2022

Khaled Abu Shakra wrote in “Nidaa Al-Watan”:

Drowning in the “ocean” of darkness left many clinging to the “straw” of Iranian fuel to power the power plants. The imported fuel will be a gift and will not cost the state a “penny”. In return, it will provide electricity and save citizens the cost of expensive generators. What sane person would turn down this generous and unprecedented offer?!

First, let’s put aside the biggest obstacle that the US sanctions on Iranian oil represent and go back to the fall of 2021. Against the background of the fuel shortage crisis and the problems of opening credits at the time, Hezbollah Secretary General Hassan Nasrallah donated the import and distribution of Iranian diesel free. Since mid-September, Iranian fuel oil tankers have been entering Syria through the illegal crossings, and the process continued until December.

However, the quantities introduced were very meager in relation to the need and they were not distributed free, rather the bulk of them were sold at a price only 10 percent below the then prevailing market price. While the price of a tank of fuel on 20 October 2021 was 270,700 Syrian pounds, the municipality’s stations sold Iranian diesel for 243,700 pounds. This led to the belief that a large part of the imported diesel was only the one smuggled into Syria since 2020. Consequently, the party made huge profits instead of accounting for the price difference. Please note that this diesel has not been customs dutyd nor have any taxes and duties been paid on it, as it is imposed on legitimate private companies.

Iranian diesel is an example

At a time when available data indicates that the amount provided in the first phase, which is the largest, of the Iranian diesel distribution process amounted to 10 million and 350 thousand dollars, of which only 2.6 million dollars were distributed as donations, the need for electricity is at least 2.5 billion dollars. “Can Iran, in economic crisis, bear such a figure as a gift? The logical answer is no,” according to a follow-up oil source. And “the best that can be presented, if we accept, for the sake of argument, the possibility of assistance, could be similar to the Iraqi oil deal. That is, exchanging 500,000 tons of fuel for services as a maximum.

Consequently, the fuel is not a gift, but an official-level trade exchange agreement between the Lebanese government and a country mired in sanctions. This is fundamentally different from importing Iranian diesel through Syria for personal use. The Iranian ships will this time drop their anchors on the Lebanese coasts and will empty the fuel in the tanks of the state power plants. Consequently, it will inevitably arrange economic sanctions against Lebanon. In addition, the introduction of fuel to the Electricity Corporation will block the road in the event that the deal to import Jordanian electricity is completed, and bring Egyptian gas to the Deir Ammar plant, which is sponsored by the United States. It will also hinder the maritime demarcation file.” In his opinion, “the purpose behind this political offer by Hezbollah is to make a new goal in the goal of isolating Lebanon from the international community and tying it to the Eastern axis. , which is punished and burdened with problems and financial crises, and thus tightened control over all joints.” vital country.

The problem is not just fuel

This is in the general geopolitical aspect. Technically, what is proposed on the basis of importing fuel is a continuation of the existing approach that limits the problem of electricity to a lack of fuel, while “the problem is much deeper.” according to oil expert Charbel Skaf. And “which indicates the absence of the intention to deal with the repercussions of the economic crisis, of which electricity occupies a large part. We are still orbiting within the framework of prosthetic solutions that make Lebanon a country of “shehadeh” and do not lead to a solution to the problem.” In his opinion, the solution to the electricity crisis is not “rocket science” and all that is required is to start serious treatment steps starting with restructuring the Elbolaget, appointing the sector’s regulatory body, tackling waste, improving collection and engaging the private sector. So what is the benefit of bringing fuel wherever it is if the waste continues and there is no charge? Regarding the Iranian fuel donation specifically for electricity, Skaf considered it “more political than economic”, aimed at promoting the opposition line, which is interested in highlighting its possession of economic tools that can help his allies. But at a quick glance, it becomes clear that this axis led by Iran, which stretches from Iraq through Syria to Lebanon, is suffering from fundamental energy crises, and there is a huge shortage and inability to provide it. Thus, the whole event is a “game that is not in place”, from Skaff’s point of view.

Sanctions are inevitable

The strangest thing about the reactions to Nasrallah’s willingness to import Iranian fuel for free is that Energy Minister Walid Fayyad welcomed the move, considering it one of the solutions to the electricity crisis. This prompted sources to follow up on the official welcome status as blackmail by America. They believe the introduction of Iranian diesel last September prompted a proposal to import electricity from Jordan and gas from Egypt. They hope that the adoption of the step this time will speed up the implementation of the agreement. What Lebanese officials are unaware of, however, according to the source, is the modus operandi of the US administration, whose reaction to this step, if it occurs, could be to include Lebanon in sanctions and stop all forms of aid. According to a tweet from the head of the Justicia Organization for Development and Human Rights, lawyer Dr. Paul Morcos points out that “Executive Order 13846 of August 6, 2018 provides for the imposition of US sanctions against anyone who knowingly offers to enter into agreements with Iranian oil companies, including holding, transferring or marketing.”

The straw of Iranian oil, which some Lebanese depend on to get rid of the inferno, is a “straw” loaded with sanctions, intentions of political dependence and chaos. Which makes it a heavy straw that will “break the back” of the economy, which is burdened with all kinds of crises, and will not save it from the darkness.