Increased Syrian Oil Exports Raise Eyebrows
Syrian heavy crude exports are expected to more than double in February, again raising suspicions that Iraqi oil continues to flow through an unauthorized pipeline, industry sources said on January 31st.
Traders indicated that Syria’s February export program for its heavy Souedie grade crude had increased sharply, signaling that Syrian refineries have been receiving illegal volumes of Iraqi oil.
The February Souedie crude export program showed that just over eight full cargoes of 80,000 tones are scheduled for liftings next month, the equivalent of about 160,000 b/d. That amount is more than double the volumes exported in January.
The February lifting program for Syrian Light grade crude exports is also larger at 15.5 cargoes.
December exports had climbed to seven cargoes of Souedie and 18 cargoes of Syrian Light, leading traders to speculate that the Iraqi-Syrian pipeline had been restarted.
Rumors had abounded that the pipeline, closed since 1982, had resumed operation, but Syrian officials claim that they have merely conducted testing on the line.
Industry sources have indicated that Syria is importing up to 150,000 b/d of Iraqi crude for use in domestic refineries, while exporting equivalent volumes of its own crude.
With Syrian domestic production already running at capacity, Damascus could not raise exports without cutting supplies to its own refineries.
The U.N. has not approved the pipeline as an accepted route for Iraqi exports, although many diplomats have suggested that they would do so if Damascus asked permission.
The U.S. State Department is still studying reports that the pipeline has resumed operation and has been trying to convince Syria to either stop the flows or allow the line to be brought under the umbrella of the oil-for-food program, but is meeting with little success, sources tell Oil Navigator™.
Iraqi Oil Minister Amer Rasheed has said recently that Baghdad plans to build a new pipeline with a capacity of around 1.4 million b/d to replace the old line.
© 2001 Mena Report (www.menareport.com)