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Exclusive - Russia, Turkey, US Allies Divide the Spoils of the Syria War

Exclusive - Russia, Turkey, US Allies Divide the Spoils of the Syria War

Saturday, 5 January, 2019 - 09:15
A Nusra Front fighter stands in an olive tree field in the southern countryside of Idlib. (Reuters)
Al-Hasakeh (northern Syria) – Asharq Al-Awsat
The prolongation of the war in Syria has left the country’s economy in tatters as local and foreign powers vie for control of its resources.

From the early days of the war, Syria’s oil and gas fields, the majority of which lie in the northeast, eastern and central parts of the country, were a primary target for opposition groups. The extremist ISIS and Hayat Tahrir al-Sham groups later set their sights on them, as did Kurdish groups.

After eight years of war, an economic survey of Syria showed that the regime, which used to control the country and its resources with an iron grip, has lost the majority of oil and gas fields. Syria’s phosphate mines, agricultural wealth and olive oil production have also fallen prey to local and foreign powers.

International reports estimate that Syria enjoys a reserve of 2 billion barrels of oil. Media reports said that the regime stopped producing light crude oil in 2012 and heavy oil in 2013.

Before the war, Syria produced some 385,000 barrels per day. The regime’s Petroleum and Mineral Resources Minister Ali Ghanem said that currently it can produce 20,000 bpd. The International Energy Agency had previously reported that pre-war Syria consumed some 240,000 to 250,000 barrels of oil per day.

As the regime continued to recapture territories, it restored control over small oil and gas fields in central Syria. These include the Shaar, al-Hayl, Arak, Hayan and al-Mahr regions in Palmyra. The US-backed Kurdish Syrian Democratic Forces (SDF) continue to control the oil and gas fields in eastern and northeastern Syria.

An SDF field source told Asharq Al-Awsat that the areas the Kurds control in northern and northeastern Syria comprise nearly 30 percent of the country’s territory. The forces have captured some 1,000 wells, some of which are in good condition and can produce oil with ease. Production at others has come to a halt due to a lack of means.

The autonomous Kurdish authority is overseeing production in these areas, said the source.

It did not disclose the size of production, but refining processes, it revealed, are meeting the local market needs, as well as the needs of neighboring Syrian areas. It did not specify whether the oil was being sent to liberated or regime-held regions.

Economists had in the past speculated that the regime was buying oil from the Kurds because they were selling it at a much lower price than the international market.

In addition, the source said that diesel fuel was being sold in Kurdish regions at 35, 50 and 60 pounds per liter. The regime was charging 180 pounds per liter in areas under its control. Before the eruption of the war, the cost stood at 7 pounds.

One of the largest gas fields, the Conoco field, lies in the eastern Deir Ezzour region under SDF control. It can produce some 10 million cubic meters of natural gas per day.

Two years ago, the regime’s Petroleum and Energy Resources Ministry said that before the war, Syria produced 21 million cubic meters of gas per day, but as of 2017 it could only muster 8.7 million cubic meters. Ghanem recently declared that the production has now risen to 16.5 million cubic meters per day.

His claims are, however, refuted by the frequent complaints in regime-held regions of the shortage of domestic gas. Long queues of people lining up to receive their daily gas canister are a regular sight in the capital, as well as the west coast and northern Aleppo region.

Local media estimated that prior to the war, Syrians consumed 3,000 to 3,500 tons of gas per day, bringing the total to 900,000 tons per year. Syria imported some 500,000 tons of this gas.

Before the war, a 9-kilogram gas canister cost 250 pounds. Now it stands at 2,700 pounds. During times of heightened crisis, the figure jumped to 7,500 pounds.

Syria was a major exporter of phosphates, ranking fifth globally before the eruption of the war. It boasted a reserve of 2 billion tons.

Phosphates is seen as a prized goal by regime allies Russia and Iran to compensate for the prices they paid for their involvement in the war. They have both competed for control over the reserves.

The Palmyra region enjoys the greatest reserves and it has fallen under the control of various powers and factions that have been vying to seize this wealth. It fell under the hands of ISIS, then the regime and its foreign militia allies that are overseen by the Iranian Revolutionary Guards. They seized control of the phosphate mines in 2015, but by 2017 the regime finally wrested control of the area and Russia appears to have emerged on top of all other competing powers.

An agreement had been reached by the regime and Iran for Tehran to invest in the mines, but Damascus stalled in meeting its pledges and it signed a deal with Moscow in 2017, which drove Iran out of the picture. No sooner had the deal been signed, that Russia began exclusively investing in the phosphate wealth, informed sources told Asharq Al-Awsat

Olive oil
Prior to the war, Syria ranked first among Arab countries and third globally in olive and olive oil production, said the International Monetary Fund. Syria was estimated to boast some 100 million olive trees that could produce 1.2 million tons of olives. As the war dragged on, the production collapsed, with official figures saying that it dropped 300 percent.

Syria’s olive wealth is centered mainly in the northwestern Idlib province, which is controlled by the Hayat Tahrir al-Sham and pro-Turkey armed extremist factions. Olive production is also high in Aleppo, which is divided between SDF and pro-Turkey groups.

As the pound collapsed to the dollar with the eruption of the war, the cost of oil olive gradually rose from 190 to nearly 2,500 pounds.

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