Cut off from Iran, Syrian crude stocks down nearly 50 percent


The Wall Street Journal reported March 22 that US sanctions have prevented Iran from exporting oil to Syria since January 2, down from an average of 66,000 barrels per day (bpd) during the last three months of 2018.

Without fresh imports from its major supplier, crude inventories in Syria have fallen.

 Ursa data shows the amount of oil in storage at Baniyas, Syria has fallen steadily since early November.

The tanks aren’t empty, but the number of barrels in storage dropped by nearly one-half over the last four months.

Ursa measures crude inventories at 150 locations around the world on a weekly basis using synthetic aperture radar (SAR).

Baniyas is Syria’s main oil port and home to one of the country’s two oil refineries. The other refinery is located in Homs. The two refineries have a combined nameplate capacity of approximately 240,000 bpd.


Source: Google
Illustration Credit: Ursa

Washington and its allies banned the sale of oil to the Syrian government in 2011 after the Assad regime’s brutal crackdown against protestors.

Iran remained a key fuel supplier by arranging illicit shipments, helping Assad survive.

The US government upped its efforts in late 2018 when the Treasury Department listed 30 ships known to have carried Iranian or Russian oil to the Syrian government.

Do business with one of these vessels and you too could fall under sanctions, Treasury warned.

Those threats seem to be working. Egypt turned away a blacklisted tanker trying to enter the Suez Canal in late November after coming under pressure from Washington, according to the Wall Street Journal.

Choking off foreign supplies is significant because Syria depends upon imports.

Syria has been a net oil importer since 2012 when the country’s oil production plummeted due to the effects of war and sanctions. Production averaged around 400,000 b/d from 2008-2010.

A recent government estimate put the figure at 24,000 bpd, but that likely understates total production because it excludes the oilfields outside the control of the Syrian regime, according to David Butter writing in the Petroleum Economist.

The major oil-producing region is found in the province of Hasakah in Syria’s northeast corner, controlled by Kurdish forces since 2012.

This is where things get interesting:

President Trump’s decision to withdraw US forces from northeast Syria has “opened the way” for the Assad regime to “reassert its control over the country’s main oil-producing region,” Butter writes.

Here’s his kicker: “This could enable Syria to reduce its dependence on imported oil and petroleum products.”

Confused yet? It sure sounds like US policy amounts to an empty punishment.

But perhaps the goal is not to inflict the maximum pain on Bashar al-Assad, but to “curtail Tehran’s influence on Damascus,” the Wall Street Journal article states.

The only problem is what happens down the road.

When Syria is looking for investment to repair its destroyed infrastructure, where do you think the money will come from?




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