Lebanon.. Two agreements to supply oil from Iraq to operate power plants

Iraq agreed to meet Lebanon’s needs for oil derivatives to operate electricity production plants, to help it get out of an economic crisis that has been going on for years.

The Iraqi government also decided to increase the volume of heavy fuel oil supplies to Lebanon, according to an existing agreement, by 50% to 1.5 million tons this year, in addition to concluding a new contract for crude oil of two million tons annually.

Under the heavy fuel oil deal that was agreed for the first time in July 2021, Iraq supplies fuel to Lebanon, and Lebanon exchanges heavy fuel oil for gas oil that can be used in power plants that have operated for decades below their full capacity, but have almost stopped working during The financial crisis that affected the country’s ability to buy fuel.

Lebanese Energy Minister Walid Fayyad said – in a statement – that the deal includes a deferred payment mechanism for a period of 6 months from the date of receipt without any financial benefits, and at a price that takes into account international competitive prices.

Fayyad told reporters earlier this May that the two deals are part of Lebanon’s attempts to improve electricity supplies.