Lebanon seeks exemption from $1.1 Bn debt to Iraq under previous oil agreement

Shafaq News / Lebanese sources announced on Saturday that there are efforts to request an exemption for their country from the $1.1 billion owed to Iraq under the previous oil agreement. However, this endeavor is facing strong opposition from influential Iraqi parties.

According to the Lebanese agency "Nidaa Al-Watan", the payment has not been made to date, as stipulated in the agreement signed in July 2021. The agreement specified that Lebanon should pay for the shipments in Lebanese pounds within Lebanon, based on the exchange rate, in return for services provided to Iraqis.

Sources suggest that there is behind-the-scenes talk and limited discussions about seeking an exemption. Notably, a new agreement will come into effect in the coming two months to supply Lebanon with an additional quantity of black oil, totaling 1.5 million metric tons. This will follow the previous mechanism, whereby gas oil and/or fuel oil types (A) and (B) will be exchanged for the benefit of the Lebanese Electric Utility, providing four hours of daily electricity supply.