Outgoing U.S. President Barack Obama issued an executive order on Friday that would lift certain trade and oil-related sanctions against Sudan in six months' time, due to "Sudan's positive actions over the past 6 months" in cooperating with the U.S. in tacking terrorism threats and a pledge to stop hostilities in conflict areas in the African country.
The revocation of the sanctions, however, will not take effect for another 180 days, and will occur only if Sudan sustains "these positive actions" over the next six months, Obama said in a letter to the Speaker of the U.S. House of Representatives and the President of the Senate.
In today's executive order, Obama is revoking in its entirety an earlier executive order from October 2006 by George W. Bush, which says that "all transactions by United States persons relating to the petroleum or petrochemical industries in Sudan, including, but not limited to, oilfield services and oil or gas pipelines, are prohibited".
As early as in September of last year, the U.S. Department of State said it welcomed Sudan's recent efforts to increase counterterrorism cooperation with the United States. "In recent months, Sudan has taken important steps to counter ISIL and other terrorist groups and has sought to prevent their movement into and through Sudan," spokesman John Kirby said back then.
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When South Sudan became independent in 2011, it gained not only sovereignty but control of about three-fourths of Sudan's oil production, a devastating blow to Sudan's economy. The IMF estimates that Sudan lost roughly 55 percent of its fiscal revenues and about two-thirds of its foreign exchange earnings. Sudan's crude oil export revenues were cut from a near $11 billion in 2010 to less than $2 billion in 2012. However, South Sudan's landlocked geography forces it to remain dependent on Sudan to transport its oil through Sudan's pipelines to the Marsa Bashayer port on the Red Sea.
Sudan, together with South Sudan, is part of the non-OPEC group of oil producers that last month pledged to join the cartel's efforts to lift oil prices by cutting output.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More