Lebanon Raises Gasoline Prices Further

Cars stand in line at a gas station as they wait to fuel up in Damour, Lebanon June 25, 2021. REUTERS/Aziz Taher/File Photo
Cars stand in line at a gas station as they wait to fuel up in Damour, Lebanon June 25, 2021. REUTERS/Aziz Taher/File Photo
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Lebanon Raises Gasoline Prices Further

Cars stand in line at a gas station as they wait to fuel up in Damour, Lebanon June 25, 2021. REUTERS/Aziz Taher/File Photo
Cars stand in line at a gas station as they wait to fuel up in Damour, Lebanon June 25, 2021. REUTERS/Aziz Taher/File Photo

Lebanon’s incoming minister of energy announced on Friday new price hikes for gasoline of nearly 40%, effectively narrowing the fuel subsidy.

This raises the price of 20 liters of 95-octane gas to 174,300 Lebanese pounds, and 98-octane gas to 180,000 Lebanese pounds. That is between $116 and $120 respectively, according to the official rate.

The price increase does not fully lift the gasoline subsidy, a step expected to take place soon.

"This is the stage before last of lifting the subsidy," Georges Braks, a member of the Petrol Station Owners' syndicate said. "The subsidy on fuel I imagine from now till the end of the month will go to the last stage and be lifted completely and all of fuel will then be non-subsidized."

Amid the economic crisis, the local currency has been in a free fall, and there are multiple exchange rates, including one set by the central bank to organize imports. The currency pegged for 30 years to the dollar at 1,500 Lebanese pounds now trades on the black market at ten times that rate.

Long queues outside gas stations have often descended into chaos or violence and caused major traffic jams. Gas stations rationed the amount of gasoline they distributed.

Prices of diesel for power generating, amid an almost non-existent national grid, have increased more than tenfold — making it impossible for many families to secure electricity for themselves. Many businesses had to shut down.



Will Tariffs Accelerate Free Trade Deals?

Container cargo ships docked at Bangkok port (Reuters)
Container cargo ships docked at Bangkok port (Reuters)
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Will Tariffs Accelerate Free Trade Deals?

Container cargo ships docked at Bangkok port (Reuters)
Container cargo ships docked at Bangkok port (Reuters)

More than 70 countries are waiting for their turn to sit at the negotiating table with US officials, as they scramble to avoid a wave of new tariffs imposed by President Donald Trump’s administration under a policy the White House has described as a “global trade rebalancing.”

As diplomatic and trade delegations rush to arrange urgent meetings in Washington, key questions are emerging over what options these nations have in order to avert a trade escalation — and whether they can secure exemptions from the new duties.

As some countries consider leveraging trade pressure or economic alliances in response, analysts warn that what the US administration calls a “preventive trade war” could trigger sweeping changes in the structure of global commerce.

In the Gulf region, however, analysts believe the impact of Washington’s decisions remains limited. They say Gulf states have enough flexibility to reposition themselves and mitigate the fallout from the new US measures.

Saudi economist Dr. Ihsan A. Buhulaiga says it is too early to speak of a final framework for global trade flows, arguing that Trump’s tariff decisions appear more like negotiating tactics than irreversible policy shifts.

“These moves seem more like bargaining positions than fixed policies,” A. Buhulaiga told Asharq Al-Awsat.

“Many countries and blocs, including the European Union, are watching closely before reacting in ways that might provoke President Trump — as was the case with China.”

A. Buhulaiga said Trump’s tariff hikes have eroded trust between the United States and its key trading partners — China, Mexico, Canada, and the EU.

“Trump’s approach is focused on generating revenue for the US Treasury from imports, with little regard for the broader consequences,” he said.

“That stance has already triggered sharp volatility — not just in equity markets, but also in bonds, especially US government debt.”

While the impact of US tariffs on Gulf states is expected to be limited, economists say the ongoing trade war is unlikely to accelerate free trade agreements between the Gulf Cooperation Council (GCC) and major economic blocs.

“For Gulf countries, including the region’s two largest economies — Saudi Arabia and the UAE — the effect of US tariffs is minimal,” said A. Buhulaiga.

“But pursuing free trade agreements with other blocs now would be risky, especially if that includes China, given the current tensions between Beijing and Washington,” he added.

A. Buhulaiga noted that tariff increases are primarily aimed at China, and pointed out that efforts to strike trade deals between the GCC and other economic alliances have taken decades with little progress.

“There’s no sign on the horizon that any agreements will be signed soon,” he said.

Meanwhile, Saudi global trade expert Dr. Fawaz Alamy explained that when the World Trade Organization (WTO) was founded, member states agreed to divide countries seeking accession into three developmental tiers.

He said advanced economies — including the United States, Canada, the European Union, and Japan — committed to fully adopting WTO rules without exceptions.

Developing nations such as China, Türkiye, Saudi Arabia, and most Arab and Islamic countries were allowed limited exemptions, while least-developed countries, particularly in Africa, were granted broader leniency.

“To promote globalization, WTO members agreed to open their markets, lock in tariff rates at agreed levels, and avoid technical barriers to imports,” Alamy told Asharq Al-Awsat.