Iraq: No Agreements to Supply Syria with Crude Oil

The Iraqi Ministry of Oil confirmed, on Sunday, that there are no contracts with the Syrian side to supply it with crude oil.

The ministry said in a statement that "some media outlets circulated information about stopping the export of Iraqi crude oil to Syria."

It added that "the State Oil Marketing Company "SOMO" confirms that there are no contracts with the Syrian side to supply them with crude oil, and therefore no exports of crude oil to Syria have been stopped."

The Syrian Minister of Oil and Mineral Resources, Ghiath Diab, confirmed last week that the oil sector in Syria after the fall of the former regime suffers from several difficulties and challenges, which constitute an obstacle to securing oil derivatives.

Diab said: "A number of oil wells are still outside the administration of the Syrian state, and this is one of the largest and most prominent of these obstacles and increases the suffering of the people."

He added: "There is no point in maintaining the sanctions imposed on Syria after getting rid of the former regime and its allies. The regime relied on its allies to supply itself with oil, and it was not affected by these sanctions as the new Syria is today."

The Syrian oil sector is witnessing renewed interest from Western oil companies after the significant decline in production after 2011. Syrian oil production fell to only about 80,000 barrels per day after it was 400,000 barrels per day before the revolution.

Oil is currently being sold at low prices of up to $15 per barrel, equivalent to 20% of its global price, due to armed groups controlling production and illegal sales, according to a report published by the Financial Times, which was reviewed by Al Arabiya Business.

Today, Western companies aspire to resume their oil operations in Syria to raise production to pre-2011 levels and sell it at prices that are in line with the global market. Among these companies stands out the British company Gulf Sands, a small oil company that was previously active in northeastern Syria, the area currently controlled by the Syrian Democratic Forces (SDF).

The company's CEO, John Bell, called for easing Western sanctions on the oil industry in Syria and regulating the sector after the overthrow of the Assad regime, stressing that resuming production would contribute to increasing the Syrian state's revenues and supporting the country's reconstruction efforts.

With the imposition of sanctions on Syria, all of these companies suspended their operations, but they are awaiting political and economic developments to reconsider returning to the Syrian market in the future.