Fall of the Assad Regime: Limited Impacts on the Global Oil Market

The fall of Bashar al-Assad's regime in Syria marks a regional political shift, but its impact on the oil market remains minimal due to the country’s drastically reduced production and exports since 2011.

Share:

The end of Bashar al-Assad’s regime, supported by Russia and Iran, represents a significant setback for these geopolitical allies. The rebel group Hayat Tahrir al-Sham, behind the victory, has taken a central role in a country where oil infrastructure is largely destroyed. This development raises many questions about Syria’s future, though the direct impact on the global energy market appears negligible.

Before the civil war began in 2011, Syria produced approximately 380,000 barrels per day (b/d) of oil. However, the conflict has reduced production to a fraction of that level. By 2015, under the control of the Islamic State (IS), production had fallen to around 40,000 b/d. Since IS’s defeat, most oil fields have come under the control of Kurdish forces and the Syrian Democratic Forces (SDF), but current production does not exceed 30,000 b/d.

A Decreasing Role in the Global Energy Economy

Despite its energy potential, Syria no longer plays a significant role in the global market. Since 2019, no oil exports have been reported, and the country relies almost entirely on its allies for its energy needs. Iran, the primary supplier, delivered 121,000 b/d in November 2023, covering part of the domestic demand for refined products, mainly diesel and gasoline.

Oil infrastructure, concentrated in the east, remains largely non-operational. The refineries in Homs and Banias operate at limited capacity, far below national needs. Consequently, domestic demand, estimated at 100,000 b/d, is primarily met through imports, underscoring the country’s growing dependency on its strategic partners.

Geopolitical and Economic Consequences

The fall of the Assad regime could reshape regional alliances, but analysts predict minimal disruption to international oil markets. Christof Rühl, a researcher at Columbia University’s Center on Global Energy Policy, stated that no significant effect on oil prices is expected, as the key market players exited Syria years ago. Similarly, Vitol analyst Mike Muller emphasized that conflicts in the region, while significant in human and political terms, have had a limited impact on global supplies.

In December 2023, dated Brent crude was valued at $72.74 per barrel, reflecting a slight decline. This trend is more indicative of global demand concerns than events in Syria, which remain peripheral to the broader oil market.

Petro-Victory Energy announces the completion of drilling operations for the AND-5 well in the Andorinha field, Brazil, with positive reservoir results and next steps for production.
The Colombian prosecutor’s office has seized two offices belonging to the oil company Perenco in Bogotá. The company is accused of financing the United Self-Defense Forces of Colombia (AUC) in exchange for security services between 1997 and 2005.
Indonesia has signed a memorandum of understanding with the United States to increase its energy imports. This deal, involving Pertamina, aims to diversify the country's energy supply sources.
VAALCO Energy continues to operate the Baobab field by renovating its floating platform, despite modest production. This strategy aims to maintain stable profitability at low cost.
An empty reservoir exploded at a Lukoil-Perm oil facility in Russia, causing no injuries according to initial assessments pointing to a chemical reaction with oxygen as the cause of the accident.
The British Lindsey refinery has resumed fuel deliveries after reaching a temporary agreement to continue operations, while the future of this strategic site remains under insolvency proceedings.
BP and Shell intensify their commitments in Libya with new agreements aimed at revitalizing major oil field production, amid persistent instability but rising output in recent months.
The private OCP pipeline has resumed operations in Ecuador following an interruption caused by heavy rains, while the main SOTE pipeline remains shut down, continuing to impact oil exports from the South American country.
McDermott secures contract worth up to $50 million with BRAVA Energia to install subsea equipment on the Papa-Terra and Atlanta oil fields off the Brazilian coast.
Saudi Aramco increases its oil prices for Asia beyond initial expectations, reflecting strategic adjustments related to OPEC+ production and regional geopolitical uncertainties, with potential implications for Asian markets.
A bulk carrier operated by a Greek company sailing under a Liberian flag suffered a coordinated attack involving small arms and explosive drones, prompting an Israeli military response against Yemen's Houthis.
The Canadian government is now awaiting a concrete private-sector proposal to develop a new oil pipeline connecting Alberta to the Pacific coast, following recent legislation intended to expedite energy projects.
Petrobras is exploring various strategies for its Polo Bahia oil hub, including potentially selling it, as current profitability is challenged by oil prices around $65 per barrel.
Brazilian producer Azevedo & Travassos will issue new shares to buy Petro-Victory and its forty-nine concessions, consolidating its onshore presence while taking on net debt of about USD39.5mn.
Major oil producers accelerate their return to the market, raising their August quotas more sharply than initially expected, prompting questions about future market balances.
Lindsey refinery could halt operations within three weeks due to limited crude oil reserves, according to a recent analysis by energy consultancy Wood Mackenzie, highlighting an immediate slowdown in production.
The flow of crude between the Hamada field and the Zawiya refinery has resumed after emergency repairs, illustrating the mounting pressure on Libya’s ageing pipeline network that threatens the stability of domestic supply.
Libreville is intensifying the promotion of deep-water blocks, still seventy-two % unexplored, to offset the two hundred thousand barrels-per-day production drop recorded last year, according to GlobalData.
The African Export-Import Bank extends the Nigerian oil company’s facility, providing room to accelerate drilling and modernisation by 2029 as international lenders scale back hydrocarbon exposure.
Petronas begins a three-well exploratory drilling campaign offshore Suriname, deploying a Noble rig after securing an environmental permit and closely collaborating with state-owned company Staatsolie.