Syria: Diesel Crisis Hits Hard as Winter Approaches

People queue to refill empty cooking gas cylinders in Deir Balaba near Homs 4 December 2011. (Photo: REUTERS - Handout)

By: Asi Abu Najm

Published Thursday, December 15, 2011

In the harsh winter season, Syrians rely heavily on diesel fuel for heating and have no other viable alternatives. But diesel scarcity has become a real crisis, as political loyalties, sanctions, and violence dry up diesel sources for Syria’s poor.

The roots of the diesel crisis in Syria began to take shape even before the onset of winter increased the demand for heating oil. Long queues of trucks and buses had piled up outside diesel gas stations several weeks earlier.

And the queues of vehicles grow longer everyday as people wait at gas stations rumored to have diesel on a particular day. Some people even end up spending the night waiting for fuel.

Some regime loyalists say that unknown armed groups have been stealing diesel and storing it, or perhaps just wasting it and throwing it on the ground.

Some of the opposition intimates that the shortage is caused by army and government vehicles that run on diesel, including convoys of tanks, heavy vehicles, personnel carriers and buses of shabiha or thugs, which are constantly on the move in an effort to crush the popular protest movement.

But European and US economic sanctions imposed on Syria – affecting the oil drilling and exploration sector – along with the ban on the sale of Syrian oil derivatives including crude oil, mean that diesel fuel should be abundant in domestic markets. The story on the ground however, is quite different.

The crisis entered a new phase as winter arrived, when Syrians began to stock up on diesel and store it, as they do every year, in tanks with capacities ranging from 200L to 1000L.

200 liters can fuel a diesel heater (sobia) 12 hours a day, for a month on average. A regular Syrian family of five would need at least 400 liters a month.

Diesel is usually supplied by distributors associated with operating gas stations. But due to scarcity and security reasons, divisions of the Arab Socialist Baath party have monopolized the registration and distribution process. That means every person who wishes to obtain diesel has to register with a party division.

The party is then able to play its usual game of favoritism and refuse people known to be in the opposition, under the pretext of having run out.

This procedure restores the party’s role as a ‘leader of the state and society,’ despite the national dialogue conferences, Arab and international pressure, and calls on the regime to enact reforms beginning with the cancellation of article 8 of the 1971 constitution, which states that “the Arab Socialist Baath Party leads the state and society.”

However the crisis appears to be deeper. Most Syrian provinces are supplied with the bare minimum amount of diesel - a full load or half a load, i.e., 10,000 or 20,000 liters - from the Syrian Petroleum Company directly to gas stations.

Gas stations in Damascus and Aleppo, cities that are thought to be part of the regime loyalist camp, are supplied with diesel daily. But provinces that lie in the opposition camp are subjected to a rationing system and an unjust distribution pattern as a form of “collective punishment,” according to the opposition.

Gas stations then distribute the diesel according to lists provided by the Baath party for 15 or 16 Syrian pounds (SYP) (US$0.30 - US$0.32) per liter on average.

Due to corruption however, the diesel is hidden and then sold on the black market for SYP20/liter (US0.40) which comes close to the SYP22 (US0.44) price of green or renewable diesel.

The poor and those who don’t have political backing have given up on the idea of storing diesel. All they want is to have enough to heat their homes from day to day.

Often an order is issued allotting only 13 liters for every citizen. The process includes a long wait for the diesel truck to arrive, which frequently stops at the wrong gas station, occasionally resulting in disputes. Sometimes people end up waiting for hours, striking up conversations which then require surveillance by security forces for fear that the gathering might turn into protest.

The crisis seems to have precipitated a recent phenomenon of wanton logging in a serious encroachment on woodland areas, private property and Syria’s environment.

There has also been an increase in the sale of electrical and gasoline-powered chainsaws (thankfully there aren’t any diesel-powered ones) and in the use of wood-fueled fireplaces.

Under general conditions of lawlessness, you can see daily trucks loaded with tons of forest wood, especially oak, as the state and its institutions focus on putting down demonstrations to the neglect of everything else, including sometimes, serious legal violations.

The price of a ton of state supplied wood rose from SYP1,300 ($US25.85) to SYP1,900 (US37.78). Some believe that this move was meant to encourage individuals to cut the remaining forests as “no one would pay such a price,” said one woodcutter.

If someone is caught cutting forest trees, they are referred to the courts, which means the case might be postponed two or three years. It seems that the future of the forest and natural resources in Syria is in danger, as are all other sectors across the country.

This article is an edited translation from the Arabic Edition.

Comments

The best numbers I could find quickly suggest that before the uprisings began, Syria's 250 thousand barrel per day of refining capacity (130 at Banias, 120 at Homs) was running at around 220. They appear to have an average yield on diesel and related products of 37%, suggesting they produced around 80 thousand barrels per day on average. Meanwhile, import statistics suggest around 25 thousand barrels per day of imports before the uprisings, so total demand of around 105. About half of that is for heating and half for transportation.

As I understand it, the recent EU embargo does not include blocking Syria from importing products. However, it does appear that banks will no longer provide letters of credit to Syria, meaning in effect that imports probably are mostly blocked. A quick search of shipping fixtures into Syria in the past six months only came up with a single 250 thousand barrel gasoline cargo into Syria from the Black Sea region, or only about a 3 thousand barrel per day average over the timeframe since the sanctions started. And no diesel.

Lebanon, Iraq, Turkey and Jordan are net short products and so in no position to send material to Syria unless they can import extra and then pass it through to Syria (as has happened before with Pakistan pulling in extra imports that in reality were feeding Iran). I haven't heard of this, but I haven't been looking closely. I somewhat doubt it given the diesel shortages being reported here, but who knows.

Even if the Syrian authorities are deliberately holding material back, they can only do so for so long before their storage fills up. Once that happens, they need to pull back on processing rates at their refineries. Which means more crude production has to be stopped or else crude storage tanks will fill up. If they could export that excess crude, then it could at least mean some extra foreign exchange earnings. But again, the lack of letters of credit from banks makes this very difficult. And a quick search of vessel fixtures out of Syria's export terminals shows absolutely zero flowing since the embargo began early September.

All of which suggests that unless there are large volumes of under the table barrels flowing into Syria via Lebanon, Turkey, Iraq, or Jordan (which I doubt but don't have data on at present), then there is in fact a genuine shortage of the fuel in Syria. I have no doubt that the authorities are in fact favoring their own forces and loyalists in distribution, but there also does appear to be a very real total volume shortage as well.

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