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SYRIA: EU Lifts Oil Embargo to Help ‘Opposition’

Bottom Line: The European Union has lifted its oil embargo on Syria ostensibly to provide “economic support” to the rebels fighting the Assad regime, but the rebels—40%+ infiltrated by Sunni jihadist groups—are not cohesive enough to make use of the oil fields they now nominally control, and the Assad regime controls the country’s two refineries.

Analysis: When the EU on Monday lifted its oil embargo on Syria, it should have taken anyone who has a clear understanding of what is going on in Syria right now by surprise. In the north, the Kurds control one oilfield—purportedly protecting it on behalf of Assad, but in reality they are controlling it for themselves and production is a fraction of what it used to be. Elsewhere, the rebels control oilfields and production has been replaced by theft and smuggling (as well as plenty of incidents in which locals are injured attempting to take advantage of the fuel anarchy). It also comes as a surprise because the regime still controls the refineries, so with the embargo lifted, only the regime can benefit, were it to be allowed to resume exports, which it won’t. The EU claims that lifting the embargo will help the rebels to export from territory they control—but without refineries? The EU seems to think this will spur “investment” in the Syrian oil industry. Indeed, at a meeting in Luxembourg over the weekend, EU officials talked about “export or investment initiatives that would be taken in “close coordination with the leaders of the Syrian opposition”. On some level, the EU concedes that the gesture is largely symbolic, and that crude would only start flowing once the situation on the ground “improves”. At the height of its oil days, Syria was only producing about 380,000 bpd, with exports almost exclusively going to Europe. Production is now down by about 50% since 2011.

Syria Map

Recommendation: View this development from another prism. What it is really about is the arms embargo, with the UK and France hoping that lifting the oil embargo will help convince detractors (Germany) to lift the arms embargo as well so they can more legitimately get weapons to the “rebels”. The timing is important as the arms embargo expires on 30 May.




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