Iraq declines to renew fuel supply deal with Lebanon due to financial disputes
Shafaq News/Iraq has decided against renewing its agreement with Lebanon to supply fuel inexchange for services, citing financial concerns, according to high-levelLebanese sources quoted by Leb Economy.
The refusalstems from the Central Bank of Lebanon's decision not to approve a new $700million credit line required to fulfill Lebanon's obligations under theagreement. The bank's stance is reportedly due to the absence of sufficientguarantees for repayment by the Lebanese state.
LebanesePrime Minister Najib Mikati visited Baghdad in an attempt to persuade the Iraqigovernment to waive Lebanon's $700 million debt from the original deal.However, his efforts were unsuccessful.
Sourcesindicated that Iraqi Prime Minister Mohammed Shia Al Sudani agreed to renew theagreement for an additional $700 million under the same conditions as before,without waiving the previous debt. This move effectively doubles Lebanon'sfinancial obligations to Iraq, now totaling $1.4 billion.
The CentralBank of Lebanon has rejected the government's request to open another $700million account to cover the services owed to Iraq in exchange for the fuel.Acting Central Bank Governor Wassim Mansouri refused, arguing that coveringthese costs would impose an undue financial burden on the bank, violating Lebanon'smonetary laws and its decision to cease extending further loans to the state.
Concurrently,Lebanon was plunged into a nationwide blackout on Sunday following theannouncement by Electricité du Liban that the last operational unit at theZahrani power plant had shut down due to a complete depletion of gas oilreserves. The outage has left the entire country without electricity,disrupting essential services, including airports, ports, water systems, andprisons.
