Unlock Editor’s Digest for free
FT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.
Syria’s largest oil refinery has ceased operations after it stopped accepting crude oil from Iran, which previously accounted for most of the country’s inputs, its general manager told the Financial Times.
Ibrahim Musallem said the Baniyas refinery, which processes 90,000 to 100,000 barrels of crude oil per day, produced its last gasoline on Friday following the ouster of Iran-backed former President Bashar al-Assad. .
“We’re only doing short-term maintenance in preparation for when oil becomes available,” he added.
Moussalem said members of Syria’s new leadership, staffed by figures from the Salvation Government that has long ruled the rebel enclave in northwestern Syria, said it was clear that sanctions on the country would be lifted and that Syria would receive supplies from sources other than Iran. “We will be able to import oil,” he said. It also allows refineries to purchase parts for their equipment.
“They said that if God willing, the sanctions would be lifted and they would be able to buy spare parts,” he said.
“We have a significant amount of (fuel) stored,” he said, adding that “the situation is stable.”
The new transitional government was established by Hayat Tahrir al-Sham (HTS), an Islamist group listed as a terrorist organization by the United States, the European Union, the United Nations and others. Despite this designation, Western governments have already begun engaging with the group’s leaders. Separately, the Syrian state is subject to extensive Western sanctions.
Oil shortages are a major challenge facing Syria’s interim government as it seeks to keep basic services functioning and begin to restore its war-torn economy.
Secretary of State Antony Blinken said Saturday that fuel shortages are “one of the immediate needs that I think we have to address.” . . That way, the lights will be on, the stores will be open, and people will be able to move around. ”
Iran has supported the Assad regime’s military and economy for years, buying Iranian oil and extending credit lines to the Syrian state to avoid U.S. sanctions on the Syrian government.
But after Assad’s ouster, the new leadership will need to secure new deals to supply vital oil and gas to the already strapped country, especially as winter approaches. Syria has another refinery in Homs, but its production capacity is low.
In recent years under Assad, Syria has imported 90% of its oil from Iran, with the remaining 10% coming from Syrian oil fields, Mousalem said.
Moussalem said the new government is considering importing both crude oil and its derivatives. He added that gas stations were initially instructed to use up their reserves to ensure fuel supply would not be cut off during the transition period, but those reserves had already been replenished.
Syria as a whole is facing a severe power shortage, mainly due to a lack of fuel to run power plants. The exception is Idlib, home to HTS, which receives regime supplies from Türkiye. A transitional government official told the FT earlier this week that power lines from Turkey had already been extended to the city of Aleppo.
Musallem said the Baniyas refinery had been building additional storage for petroleum products since 2020 in anticipation of a maintenance project that would require a two-month shutdown.
He described long-standing issues at the refinery that need to be addressed, including aging stacks and damage from the 2022 earthquake. Refineries are rushing through small maintenance projects while waiting for new shipments of crude oil. “But the machines cannot be stopped for long periods of time, so corrosion can occur,” he said.
He said that between 2017 and 2020, refineries were sometimes forced to shut down operations for up to two months due to a lack of crude oil shipments.
Moussalem said Syria’s new government, which took office after HTS seized control of much of the country last week, has promised to raise civil servant salaries by 300 to 400 percent. Wages for government workers in Syria amount to about $25 a month, forcing them to take second or even third jobs or rely on funds from relatives abroad.
He said representatives of the new government were “listening and not saying much” at the meeting as they sought to learn the technicalities and inner workings of the previous government’s system.
