Return to Oil Could Help Rebuild War-Torn Syria

Syria’s economy has been hamstrung by the 14-year-long war and the heavy sanctions that were placed on it in order to try and pressure former President Bashar al-Assad into stopping the fighting. In 2011, when the war began, the European Union and the United States imposed sanctions on different sectors, including on imports of Syrian oil. In 2019, the U.S. then introduced an additional package of sanctions called the Caesar Act, which came into force in 2020 and were designed to stop any dealing with and support of the al-Assad regime via “secondary sanctions” on third-party individuals or entities.

Data from BP and the Energy Institute shows that Syria’s oil production plummeted following the bans. Where the country had produced more than 400,000 barrels of oil per day in 2010, this had dropped to just 24,000-34,000 per day between 2014 and 2019. To put this into context, even in its hey-day this production was fairly low compared to its regional neighbors, for example, with Iraq having produced 4.4 million barrels per day in 2023. Still, prior to the war, Syria had been an oil exporter and was self-sufficient in terms of energy supplies. 

As the below chart shows, despite the sanctions, Syrian oil production never went down to zero throughout the war. This is due to several reasons, including the continued processing of crude oil in areas under the al-Assad regime’s control, which were delivered by pipeline to the state-owned Banias and Homs refineries. While Syria could not export oil legally, it could refine and consume its own production for local energy needs. These were met with additional imports from Iran, which stopped promptly on December 9, 2024 - the day after al-Assad’s fall. At the same time, oil continued to be produced in the areas that al-Assad’s government had lost control of to the self proclaimed ISIS in the northeast of the country in 2014, with many of the oil fields later re-captured by the SDF in 2017 and held under their control, according to the USGS. In the latest move, the SDF has now agreed to hand over the region’s oil and gas fields as part of a new pact between the SDF and today’s central interim government. 

As the country looks to rebuild its ruined economy, analysts note that reviving its oil and gas industry could provide not only the energy but also contribute to the revenue needed for its post-war reconstruction, with the proven petroleum reserves in Syria estimated at 2.5 billion barrels as of 2020. But a return to Syrian oil production will not be without its challenges, with oil refineries and other production facilities having been damaged in the war, requiring time and resources to rebuild. 

According to Brenda Shaffer of the Atlantic Council, Turkey will play a major role in supporting Syria to rebuild its energy sector and in reconstructing the country. At the same time, she notes, the improvement of Syria’s energy sector could also benefit other areas in the region, including Lebanon, which suffers from insufficient power supplies.

In order to make economic recovery possible, Syria's Interim President Ahmed al-Sharaa has repeatedly called for sanctions on Syria to be lifted. Where the UK last week lifted sanctions on petroleum firms, the EU has suspended some sanctions including those on energy. The U.S. eased some sanctions on January 6 but most still remain in place.