Crude traders in the Mediterranean widely believe that Iraq is still pumping oil to Syria despite Baghdad having suspended oil exports for 30 days from Apr 8 to protest Israel's military offensive against the Palestinians.
Crude traders in the Mediterranean widely believe that Iraq is still pumping oil to Syria despite Baghdad having suspended oil exports for 30 days from Apr 8 to protest Israel's military offensive against the Palestinians. "It is remarkable that Syrian crude exports have increased considerably after Iraq imposed an oil embargo on April 8," one trader said Thursday. Overall, a 14% increase on Syrian crude exports was noted from April into May 2002, traders said. This month some 1.4-mil mt of Syrian Light oil was scheduled to load from the Syrian port of Banias, indicating an increase of 9% on April's volume. The May 2002 loading program for Syrian Heavy crude, which is said to be similar to Iraqi Kirkuk in terms of quality, suggests volumes are set to rise by close to 40%, from 552,000mt in April to as much as 760,000mt in May.
Lifters point out, however, that this apparent rise in volume does not fit comfortably with assessments of Syria's production capacity. The US energy department's Energy Information Administration estimates that Syria's output peaked at 604,000 b/d in 1996, since when it has fallen to a current average of 350,000 b/d. Some attributed export changes to potential refinery maintenance in Syria, which should indicate a rise in imports of refined products. Syria's state-owned Sytrol was unavailable to comment, while trading sources saw no striking evidence suggesting an increase of refined product imports into Syria. Rumors date back eight months that Iraq has been supplying Syria with crude by pipeline in contravention of UN's sanctions policy. The UN permits Iraq to export its oil only from specified export points regulated by the organization's oil-for-food program. Both Syria and Iraq have several times denied any reports suggesting Iraqi oil has been smuggled into Syria. One Syrian official in February acknowledged there had been trial runs on the pipeline, but said it was too difficult to operate, prompting Syria to plan the construction of a new one. But the official insisted that Syria would act only in line with UN rules. "Whether it is a matter of a new pipeline, or of oil transactions with Iraq, we have said we will respect the UN resolutions," the official said at the time.