Fuel shortage chills northeast Syria as oil production lags

Northeast Syria, where the majority of the country’s oil reserves are located, is suffering from an acute fuel shortage. The Kurdish-led Autonomous Administration that controls northeastern Syria is not producing enough oil and gas to meet the demand, and civilians living under its control are accusing it of corruption and inequitable distribution.

“I stood in line for an hour until I got 26 liters of diesel, which is much less than what I need, but there is no alternative,” a man living in Western Qamishli told Al-Monitor under the pseudonym of Sirwan Hami. “I’ve also been looking for a gas cylinder since the beginning of February, and I have yet to find one,” he said. 

Diesel and gas are essential supplies for families in the area. More than one out of five of northeast Syria’s residents are internally displaced people, according to an estimate by the UN Humanitarian Needs Assessment Program in November 2020. Many of them live in informal or substandard accommodations, leaving them especially vulnerable to Syria’s cold winters. Temperatures dropped as low as 17 degrees Fahrenheit this year. 

Though the administration devised a plan to distribute free diesel in northeast Syria, intending to give each family three 440-liter rations of diesel, residents complained to Al-Monitor that they had only received one ration while others had received no fuel at all. 

Hami, for example, said that his neighbor had received two rations while he had received only one and complained that “corrupt individuals in the administration” were playing favorites. Another resident from the city of Amuda said that officials had charged him nearly double the official price of gas with no explanation for the price increase. 

The administration sells subsidized diesel and gas, but shortages have meant that residents have had to buy from regime distribution points, which charge up to three times the subsidized price for gas and have a reputation for filling cylinders halfway. Other residents turn to the black market, where the quality of the gas is suspect and prices are also higher than the subsidized rates: 3,500 vs 7,500 Syrian lira ($0.89 vs $1.92).

“Every winter we suffer from a diesel shortage, but this time we don’t know the causes,” Hami said. “We heard that the Autonomous Administration is cracking down on [oil refining] with the excuse of protecting the environment, but smuggling continues to the regime’s areas.” 

The administration smuggling crude oil to regime-held territory has long been an open secret and is tacitly condoned by the United States, which issued a waiver to a US company Delta Crescent Energy to develop the refining and extraction capacities of northeast Syria.

Sadiq Mohammad al-Khalaf, co-minister of fuel for the Autonomous Administration, said that the fuel crisis is “under control” and that it was the low production capacity of oil refineries and gas plants that was creating the fuel crisis in the northeast. “The oil refineries we have are basic and not up to global standards; they do not create good quality [fuel]-so we had a crisis. We also are in need of a million gas cylinders per month to give each family one cylinder — our problem is that there are no oil refineries or gas plants," he told Al-Monitor.

Khalaf’s statement hits at the heart of the dilemma facing the Syrian oil industry, where the de facto geographical division of the country into three zones of control has prevented what was once Syria’s most lucrative industry from getting back on its feet. The oil fields lie under the control of the Autonomous Administration, but the refining equipment lies in regime-held territory, constraining the capacity of both authorities from fully utilizing the resources at their disposal. Smuggling is a natural consequence of this dilemma but comes at the expense of civilians, who face increased fuel prices as war profiteers maintain chokepoints for the oil, lining their pockets in the process. 

Before the Syrian revolution began in 2011, Syria produced 368,000 barrels of oil a day. Today the number is much lower, with estimates of daily production ranging from 100,000 to 89,000 bpd. The administration’s 2020 budget breakdown reveals that oil revenues were somewhere under $37 million last year, though the exact figure is unknown because the data provided includes agriculture and customs revenue. Notably, this was a slight decline from last year’s oil-related revenues in the Kurdish-led authority.

To increase its fuel and oil production in general, the northeast needs to repair and construct new oil refineries. The administration’s budget readout mentions a coming “oil refinery” project, but gave no other details. Delta Crescent Energy is supposed to help develop the area’s oil refining capacity, but it’s unclear how or when this will occur.

To make up for its own oil shortage, the Syrian regime has imported massive amounts of crude, importing an average of 53,000 barrels per day from Iran in January and signing tenders with Russia to import 180,000 tons of petrol over the coming months. The regime can then refine the oil and sell it to its citizens, as it holds the country’s refineries. The Autonomous Administration, by contrast, has no such ability to import fuel from international allies and thus must achieve self-sufficiency or reach a deal with Damascus, perhaps as part of greater political negotiation regarding the status of the autonomous area. 

Northeast Syria’s fuel shortage comes as the value of the Syrian lira plunges to unprecedented lows, dropping to 3,960 per US dollar on March 2, severely undercutting the already diminished purchasing power of Syrian civilians amid the country’s spiraling economic crisis. The area is also suffering from a wheat shortage that has left some of the area’s poorest residents hungry. 

The result, as Sirwan Hami put it, are streets made of “bread, diesel and gas queues.”

Mohammad Abdulsattar Ibrahim contributed to this article.