Military tensions paralyze South Sudan’s oil exports

The blockage of South Sudan's oil exports, crucial to its economy, continues due to military tensions in Sudan, involving the Rapid Support Forces.

Share:

South Sudan, heavily dependent on its oil exports, is seeing the revival of this activity jeopardized by the military situation in Sudan. The Rapid Support Forces (RSF), a paramilitary militia led by Mohamed Hamdane Daglo, known as Hemedti, control strategic infrastructures essential to the export of South Sudanese crude.
This control is preventing any effective resumption of oil flows, which have been blocked for over a year, and is having major repercussions on the South Sudanese economy. The country, 90% of whose revenues are generated by the oil sector, has been losing around $100 million a month since the suspension of exports.
These losses also affect Sudan, which benefits from transit rights for South Sudanese oil passing through its territory.
However, the RSF, in the midst of its rivalry with Sudanese President Abdel Fattah al-Burhan, has strategic leverage in maintaining its grip on the oil infrastructure.

Strategic blocking of RSFs

The RSF’s control over the pumping stations represents a major obstacle to the resumption of exports for South Sudan.
By holding this key position, Hemedti and his paramilitary forces are imposing conditions on Sudan’s internal political negotiations.
The rivalry between Hemedti and al-Burhan is thus being played out on several fronts, further complicating any rapid resolution of the situation.
The ability of the RSF to block exports is an asset for Hemedti in his negotiations with al-Burhan.
This strategy is delaying progress in discussions aimed at restoring oil flows, an essential element in the economic stabilization of the region.
The threat posed by this military control is not limited to relations between the two Sudanese generals, but extends to the entire South Sudanese economy.

Economic consequences for South Sudan

The prolonged stalemate is having dramatic repercussions for South Sudan’s economy.
The African Development Bank (AfDB) forecasts that, without a recovery in exports, South Sudan’s current account deficit will remain at 7% of GDP in 2023/2024, limiting the country’s ability to finance its infrastructure and public services.
A recovery could reduce this deficit to 4% in 2024/2025, but this prospect depends entirely on the progress of negotiations in Sudan.
The interruption of oil flows is also affecting price stability on international markets, as South Sudanese oil is an important component of regional exports.
The persistence of this blockage maintains pressure on the country’s economic equilibrium, exacerbating internal tensions and limiting Juba’s room for maneuver on the international stage.

Alternatives for Sudan

On the Sudanese side, the need to secure its own exports is prompting the authorities to consider logistical alternatives.
A pipeline project linking Sudan to Djibouti, via Ethiopia, is currently under study.
Although Djibouti has expressed its support for this initiative, its implementation could take several years, delaying any beneficial effects in the short term.
If implemented, this project would diversify export routes, reducing dependence on infrastructure shared with South Sudan.
The issue of energy infrastructure remains critical for Sudan, which is seeking to stabilize its economy while coping with a prolonged political crisis.
Transit fees linked to South Sudanese oil are an important source of revenue for Khartoum, particularly against a backdrop of financial instability and inflation.
The completion of this pipeline could nevertheless offer some relief in the medium term, while changing the geopolitical dynamics of the region.

Internal rivalries and regional implications

The conflict between Hemedti and al-Burhan has a direct impact on economic relations between Sudan and South Sudan.
Until these internal political tensions are resolved, prospects for a recovery in oil exports will remain fragile.
This situation amplifies the challenges facing Juba, highlighting the country’s dependence on the stability of Sudan.
Internal rivalries in Sudan are also complicating the efforts of international investors and economic partners, who are awaiting a swift resolution before considering a resumption of investment in the oil sector.
Without a stable agreement between the various Sudanese factions, economic prospects for South Sudan and Sudan will remain limited in the short term.

The expansion of the global oil and gas fishing market is accelerating on the back of offshore projects, with annual growth estimated at 5.7% according to The Insight Partners.
The Competition Bureau has required Schlumberger to divest major assets to finalise the acquisition of ChampionX, thereby reducing the risks of market concentration in Canada’s oilfield services sector. —
Saturn Oil & Gas Inc. confirms the acquisition of 1,608,182 common shares for a total amount of USD3.46mn, as part of its public buyback offer in Canada, resulting in a reduction of its free float.
OPEC slightly adjusts its production forecasts for 2025-2026 while projecting stable global demand growth, leaving OPEC+ significant room to increase supply without destabilizing global oil markets.
Talks between European Union member states stall on the adoption of the eighteenth sanctions package targeting Russian oil, due to ongoing disagreements over the proposed price ceiling.
Three new oil fields in Iraqi Kurdistan have been targeted by explosive drones, bringing the number of affected sites in this strategic region to five in one week, according to local authorities.
An explosion at 07:00 at an HKN Energy facility forced ShaMaran Petroleum to shut the Sarsang field while an inquiry determines damage and the impact on regional exports.
The Canadian producer issues USD 237 mn in senior notes at 6.875 % to repay bank debt, repurchase USD 73 mn of 2027 notes and push most of its maturity schedule to 2030.
BP revised upwards its production forecast for the second quarter of 2025, citing stronger-than-expected results from its US shale unit. However, lower oil prices and refinery maintenance shutdowns weighed on overall results.
Belgrade is engaged in complex negotiations with Washington to obtain a fifth extension of sanctions relief for the Serbian oil company NIS, which is majority-owned by Russian groups.
European Union ambassadors are close to reaching an agreement on a new sanctions package aimed at reducing the Russian oil price cap, with measures impacting several energy and financial sectors.
Backbone Infrastructure Nigeria Limited is investing $15bn to develop a 500,000-barrel-per-day oil refinery in Ondo State, a major project aimed at boosting Nigeria’s refining capacity.
The Central Energy Fund’s takeover of the Sapref refinery introduces major financial risks for South Africa, with the facility still offline and no clear restart strategy released so far.
PetroTal Corp. records production growth in the second quarter of 2025, improves its cash position and continues replacing key equipment at its main oil sites in Peru.
An explosion caused by a homemade explosive device in northeastern Colombia has forced Cenit, a subsidiary of Ecopetrol, to temporarily suspend operations on the strategic Caño Limón-Coveñas pipeline, crucial to the country's oil supply.
U.S. legislation eases access to federal lands for oil production, but fluctuations in crude prices may limit concrete impacts on investment and medium-term production, according to industry experts.
Permex Petroleum Corporation has completed a US$2mn fundraising by issuing convertible debentures, aimed at strengthening its cash position, without using intermediaries, and targeting a single institutional investor.
Petróleos de Venezuela S.A. (PDVSA) recorded $17.52bn in export sales in 2024, benefiting from increased volumes due to U.S. licences granted to foreign partners, according to an internal document seen by Reuters.
The detection of zinc in Mars crude extracted off the coast of Louisiana forced the US government to draw on its strategic reserves to support Gulf Coast refineries.
Commissioning of a 1.2-million-ton hydrocracking unit at the TANECO site confirms the industrial expansion of the complex and its ability to diversify refined fuel production.