A “temporary solution” to the fuel crisis in Syria… Imports are controlled

A “temporary solution” to the fuel crisis in Syria… Imports are controlled
A “temporary solution” to the fuel crisis in Syria… Imports are controlled
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Since the beginning of January, government and media agencies in regime-controlled areas have begun to promote a solution to the fuel crisis that paralyzed Syria in the last two months of 2022.

The promotion was accompanied by a partial return to the basic aspects of life, such as working hours for employees, school and university students, which stopped when the fuel crisis reached its climax, in addition to statements by officials stating an increase in transportation allocations, and an increase in the distribution of “heating” fuel oil to families.

The talk about resolving the fuel crisis did not clarify whether it was temporary, or answer the street’s questions related to the extent of the capacity of the oil tankers currently arriving to meet the needs, especially in light of media talk about Iran doubling crude oil prices, its requirement to pay later, and the slow pace of oil production. Unprecedented in its oil transfers to Syria.

Imports control crises

On December 18, 2022, the Minister of Internal Trade and Consumer Protection, Amr Salem, stated that oil derivatives could be available on January 15, without explaining the reason for setting this date, vowing that the situation would return to what it was before the “last crisis.” Not like it was in the past, he said.

The government does not officially announce the volume of oil supplies that successively reach the areas under its control, as the details of this information are limited to websites specialized in tracking and monitoring oil tankers on the one hand, and local media reporting news about the arrival of tankers from unnamed sources in the port of “Baniyas.”

According to what Enab Baladi monitored, two Iranian tankers of gas and diesel oil arrived in the port of “Baniyas” this January, and an oil tanker loaded with one million barrels of crude oil. It is also expected that two Iranian oil tankers will arrive in the coming days, with an estimated load of 2.1 million barrels of oil. Crude, according to monitoring and tracking sites for ships and oil tankers.

Associate professor at the European University Institute in Florence, Italy, and a participant in the Wartime and Post-Conflict Project in Syria, Dr. Joseph Daher told Enab Baladi that Syria today relies on oil imports, especially from Iran, so any problem with imports, It means that there is a fuel crisis that the country will experience.

Daher explained to Enab Baladi that the sanctions imposed on the Syrian regime contribute to the import problems. Likewise, the government’s policies and corruption also deepen the problem of fuel access to Syria, considering that the lack of fuel in the markets is still a structural problem, and there are no short-term solutions for it.

And at the end of November 2022, the Minister of Oil, Bassam Tohme, justified the recent bad reality of fuel by the government’s reliance on supplies (which are governed by international and environmental conditions) at a large rate, explaining that the ministry does not have any sufficient fuel to the extent that allows it to form a strategic stockpile, in which it meets Long material outages, since the largest carriers that arrive are only enough for days, and do not allow securing a stock of them.

Iranian terms

On January 15, the Wall Street Journal reported that Iran had doubled the price paid by the Syrian regime for crude oil, which it considered to be the cause of the fuel crisis that Syria suffered from last year.

The newspaper added that the line of credit, which previously allowed Syria to pay later, was quickly exhausted after Iran raised the price from an average of $30 per barrel, prompting Tehran to impose advance fees in return for supplying the regime with oil.

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The newspaper’s report pointed to a slowdown in the transfer of Iranian oil to Syria, explaining that the next tanker will not leave Iran for Syria until early next March, which means a time gap of no less than 11 weeks between two shipments, given that the previous shipment left in mid-December 2022.

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One day after the newspaper’s report, the local newspaper, Al-Watan, quoted an official Iranian source (which it did not name), denying the news reported by the “Wall Street Journal,” adding, “The issue of oil supply is coordinated between the senior leaderships of the two countries, and any information published outside The leadership of the two countries is wrong and incorrect.”

While the Ministry of Internal Trade, when the fuel crisis intensified in mid-December 2021, raised the selling prices of all kinds of fuel, justifying this by ensuring the arrival of fuel, as the Prime Minister, Hussein Arnous, stated at the time that the state was facing two options, either to lose oil derivatives from the markets, or To increase prices in a “simple” way helps secure them.

At the time, the Minister of Internal Trade, Amr Salem, stated that the government was now forced to secure fuel supplies from sources other than those usually approved (without naming them), which forced it to raise prices, due to the high costs of importing them.

Dr. Joseph Daher told Enab Baladi that the “Wall Street Journal” talk needs confirmation, wondering: Why is Tehran asking Damascus to pay for its oil at prices close to market levels, while It drastically reduces the oil it delivers to other customers in much better financial shape, like China.

Daher believes that the economic relations between Iran and the Syrian regime since 2011 were characterized by a lack of transparency, especially with regard to the oil sector, considering that the statements of Iranian officials in the Syrian media about their denial of this information aim to calm popular frustration.

China imports about one million barrels per day of Iranian oil, mostly through clandestine routes, and unlike the regime, it pays for its oil in advance, doubling Tehran’s interest in selling it oil to support the Iranian economy.

Living affected

Dr. Joseph Daher explained that raising oil prices will negatively affect the state budget and the economy in general, especially agricultural and industrial projects, as it raises production costs, which will increase the cost of goods and thus the cost of living.

He pointed out that even before the recent fuel crisis, the government was delaying in delivering fuel and diesel fuel to industrialists and farmers at the “subsidized” price, or receiving quantities that are not sufficient to continue their activities except for short periods of time, which forces them to rely on the “black” market, where fuel prices reach up to Double the “subsidized”.

Regarding the possibility of the regime’s government paying oil prices in advance to Iran, Daher believes that the balance of power is not in favor of Damascus, and it does not have many issues to put pressure on Iran in this sector, considering that it is likely that Tehran will try to gain some things from Damascus, but at the same time Himself does not want to see more instability in Syria.

The areas controlled by the Syrian regime need about six million barrels of oil per month, at a rate of 200,000 barrels per day, of which only 20,000 barrels are produced, according to a previous statement by the Prime Minister, Hussein Arnous, in April 2021.

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