Syria's oil industry struggling amidst rebel advancement


Syrian's political turmoil has badly damaged the country's  oil industry.

According to estimates, the country's oil production is around half the pre-2011 levels of some 380,000 barrels a day, with many oil fields now in the hands of militia groups opposed to President Assad's regime. In some cases, wells have been set alight or damaged.

Oil exports, which brought Syria more than $3bn in 2010, have practically stopped as any output is used for domestic needs.  Shortages, particularly of vehicle fuel, and rising prices are a major feature of Syrian life due to attacks on oil pipelines and infrastructure. Interrupted electricity supplies are also common as a result of reduced fuel supplies to power stations. There are reports of makeshift 'refineries' being set up to provide small quantities of fuel for local communities.

The government has been forced to import refined fuel supplies to keep up with demand. The Oil Ministry is discussing possible exploration for gas and oil in the Mediterranean off Syria's coast with Chinese and Russian officials.

There are conflicting reports on the number of oil fields in direct government control, with the two main centres of oil production - the eastern province of Deir el-Zour and the northeastern Kurdish-majority region of Hassakeh - both affected by the internal conflict. The country's two refineries in the central city of Homs and the coastal city of Banias are currently remain under the control the Oil Ministiry.

The US and European Union banned Syrian oil exports in 2011, depriving the country of its main customers.  However, the EU recently lifted the embargo apparently to provide economic support to the forces fighting President Assad's regime. The decision will allow crude exports from rebel-held territory only, the import of oil and gas production technology and investments in the Syrian oil industry.