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Syria and the Oil Shortage
November 15, 2005: As if Syrian President Bashir Asad hasnât got enough problems, what with trying to walk a fine line between reformist and conservative factions in the Baathist regime, trying to fend off UN pressure regarding Syrian involvement in the death of former Lebanese PM Rafic Hariri (which may reach right into his immediate family), and the ordinary, everyday trials and tribulations of being a dictator, what with the ever present threat of coups and assassination attempts, he now faces a serious economic problem â Syria is running out of oil.While never one of the mega-petroleum producers, for most of the past 30 years Syriaâs daily output averaged about 600 thousand barrels. This was more than sufficient to provide for the countryâs internal petroleum consumption, for most of the period under 200,000 barrels a day, and brought in a substantial amount in foreign exchange, particularly since the local product is a relatively high quality light crude. This effectively subsidized the Syrian economy, while providing the Baathist regime with lots of extra cash. But for the last few years production has been declining, to just under 500 thousand barrels a day, while domestic consumption has been rising, probably topping 300,000 barrels a day in 2004. The government has taken a number of steps to address the problem, converting oil fired electrical plants to operate on natural gas, subsidizing extensive exploration, and so forth. But with only about 2.5 billion in proven reserves and rising consumption, the country is likely to become a net importer of oil within five years or so. What keeps the Baath Party afloat in Syria is money, and most of the cash comes from Syrias small oil reserves. When the oil fades away, so does another pillar of support for the government. Posted by: Steve 2005-11-15 |
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