According to the Ministry of Finance, transfers to EDL witnessed a significant yearly drop of 26.17% to reach $ 65.85M in January 2019.
In details “Payments to fuel and oil gas suppliers KPC and SPC” (which grasped 98.64% of the total amount) decreased yearly by 26.40% to $64.95B in January 2019. This significant rise can be mainly attributed to the 13.99% yearly retreat in average prices of crude oil to $59.41 /barrel in the first month of 2019 and lower Volume of imported fuel oil by 100% in January 2019 comparing to the same period last year. However, the volume of imported Gas oil increased yearly by 120% in January 2019.
Furthermore, EDL contributed 0.2% from a total oil bill of $65M in Jan 2019, down from its previous share of 0.43% from a total oil bill of $88M, in same period of 2018.
Worth mentioning that Lebanon’s fiscal deficit (cash basis) narrowed from $378.91M in January 2018 to $72.83M in January 2019 and EDL transfers represented a share of 14.17% of the government’s primary expenditures, which reached $800.24M in January 2019, compared to a share of 8.54% in Jan 2018. In its new budget the Lebanese Cabinet has approved a plan to upgrade the electricity sector in order to narrow its deficit by improving production and distribution, and raising tariffs.
Contribution of EDL in the Total Oil Bill in January
Source: MoF