Iraq has signed an agreement allowing the cash-strapped Lebanese government to pay for 1 million tonnes of heavy fuel oil a year in goods and services, helping Lebanon ease its acute power shortage, the two sides said on Saturday.
Lebanon is in the throes of an economic meltdown threatening its stability. It has all but run down foreign reserves and faces a growing shortage of fuel, medicine and other basic goods. Most Lebanese face power cuts for many hours a day.
Iraqi Finance Minister Ali Allawi and Lebanese caretaker Energy Minister Raymond Ghajar co-signed the agreement in the presence of Iraqi Prime Minister Mustafa al-Kadhimi.
Lebanese officials have said the Iraqi supplies will ease the situation at home.
Ghajar, speaking on his return to Beirut after signing the deal, said the fuel would be used for electricity generation and was enough for four months. He said it was worth about $300m to $400m.
Iraq’s Oil Ministry said in a statement it would supply Lebanon with surplus heavy fuel oil from its refineries.
