• 2 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 2 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 2 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 2 days Schlumberger Warns Of Moderating Investment In North America
  • 2 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 2 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 2 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 2 days New Video Game Targets Oil Infrastructure
  • 3 days Shell Restarts Bonny Light Exports
  • 3 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 3 days British Utility Companies Brace For Major Reforms
  • 3 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 3 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 3 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 3 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 3 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 3 days Rosneft Signs $400M Deal With Kurdistan
  • 4 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 4 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 4 days Russia, Saudis Team Up To Boost Fracking Tech
  • 4 days Conflicting News Spurs Doubt On Aramco IPO
  • 5 days Exxon Starts Production At New Refinery In Texas
  • 5 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 5 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 5 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 5 days China To Take 5% Of Rosneft’s Output In New Deal
  • 5 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 5 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 5 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 6 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 6 days OPEC Oil Deal Compliance Falls To 86%
  • 6 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 6 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 6 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 6 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 7 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 7 days Aramco Says No Plans To Shelve IPO
Alt Text

Power Struggles In The DRC Are Hampering Energy Potential

The Democratic Republic of Congo…

Alt Text

Libyan Oil May Be Slipping Out Of Putin’s Reach

Last Friday, the Benghazi Defense…

Daniel J. Graeber

Daniel J. Graeber

Daniel Graeber is a writer and political analyst based in Michigan. His work on matters related to the geopolitical aspects of the global energy sector,…

More Info

South Sudan Experiment Headed Toward Failure

South Sudan Experiment Headed Toward Failure

The World Bank, in a draft document reviewed by the independent Sudan Tribune, warns that South Sudan could collapse by its two-year anniversary because authorities in Juba were unaware of the consequences of one of its very first unilateral decisions. The South Sudanese government early this year, roughly six months into independence, expressed frustration with Khartoum's claims on revenue and halted the production of at least 75-percent of the regional oil. But with Khartoum controlling the export infrastructure, the move now seems to have backfired. Either South Sudan was unprepared politically for independence or it lacked appropriate guidance to manage its internal affairs. Either way, the future for the world's newest country looks incredibly grim.

South Sudan gained independence in July under the terms of a 2005 peace agreement that, with Washington's help, ended one of the bloodiest conflicts the world has ever known. Senior U.S. officials, from Princeton Lyman, the U.S. special envoy for Sudan, to Susan Rice, the U.S. ambassador to the United Nations, noted that several issues, including oil, were left in the negotiating table in favour of independence. Now left to its own devices after a successful July referendum, however, South Sudan decided to shut down production of the 75-percent of the oil reserves in the region in January in an effort to punish Khartoum.

According to a transcript of a World Bank meeting, nobody in the administration of South Sudanese President Salva Kiir was "aware of the implications of the shutdown," the Sudan Tribune reports. Even if South Sudan somehow found a way to get revenue from outside the oil sector, the World Bank estimates that its foreign reserves would run dry by July 2013. By that time, the newspaper quotes the briefing as saying, "state collapse becomes a real possibility."

Then what? Apart of rampant poverty, deadly cattle raids and defiance in the face of sweeping U.N. condemnations, what happens if South Sudan collapses? Was that future anticipated by the architects of the 2005 CPA? Are these the same architects who pressed for elections a year later in the Palestinian territories? Against the backdrop of the furore over Israeli settlements, the viability of the Hamas leadership in the Gaza Strip and increased partition is a quiet push for a one-state solution. Inter-system competition, the argument goes, diminishes the evolutionary benefits of intra-system competition. Maybe the same could be said for Sudan.

South Sudan doesn't have the means to get its oil out of the country without Sudanese pipelines. Using regional projects, like the Baku-Tbilisi-Ceyhan oil pipeline as a model, it would likely be 2020 before a similar pipeline would stretch from oil fields in South Sudan to a theoretical end point at the Kenyan port of Mombasa. Using the World Bank forecast of a state collapse by 2013, and given the protracted conflict in the region, any effort to build an oil pipeline from South Sudan would likely be for naught because by 2020, it will be too late. Given the strategic links between national security and oil wealth, and considering Palestine as something of a regional model, the Sudanese experiment in a two-state solution appears to be headed toward failure. Deadlines and benchmarks do little, apparently, when real issues are at stake.

By. Daniel Graeber of Oilprice.com




Back to homepage


Leave a comment
  • Charles Anteros on May 08 2012 said:
    This article was prematurely writtten as World Bank has refuted the article by Sudan Tribune, saying the media misrepresented its views. Accordingly and agreeably, AFP has announced that both economies of Sudans were at stake. Naturally, that would be logical. However, to simply say South Sudanese were not prepared for the outcome of unlaterally halting oil, regards the opinion as an opinion and biased. If Sudan was prepared for the outcome of unilaterlly siezing South Sudan's oil and also halting the shippment of yet 3 mil barrels, their economy would have been sound. To the contrary, Sudan's finance mininster has stated that due to lack of revenue from oil transit fees, sudan's economy was in the virge of collapse.
    I love to read an article or comment that makes sound judgement.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News