Syria has never been a major petroleum power, but oil is a key resource fought over by all the factions in its civil war.
ISIL, the great profiteer from looted oil, is now under siege in its capital of Raqqa and largely defeated in its Iraqi base of Mosul. Yet hydrocarbons will continue to shape the country’s war economy.
Conspiracy theories that the war was triggered by a Qatari desire to build a gas pipeline across the country, always ridiculous, have been further discredited by the current Saudi-led embargo of Doha. Similarly absurd are ideas that western companies are set to profit in some big way from Syrian oil or perhaps offshore gas. On the contrary, Shell, Total and others lost valuable assets with the outbreak of the war.
The real importance of Syria's hydrocarbons is to be found within the country, and with its immediate neighbours. From 2014, when it captured the Omar field, ISIL controlled most of the country's production. National oil output of 385,000 barrels per day in 2010, the last year before the war, plummeted to about 100 000 bpd by 2015, of which ISIL extracted 65,000 bpd, the Assad regime 10,000 bpd and the Kurdish-held north-east 25,000 bpd, as reported by Hussein Almohamad and Andreas Dittmann of the University of Giessen.
Along with fields in Iraq that it controlled for a time, Syrian oil was a key source of ISIL financing. It inserted itself into a complex web of smuggling, provision of fuel to hold the loyalty of its territories, and local deals with tribes who were given cuts of oil wells. It also continued to sell gas to Assad regime-controlled power plants, even while it seized gasfields around Palmyra, now recaptured.
Now the US-led anti-ISIL coalition has been attacking ISIL oil assets more aggressively than ever. Figures from the US consultant Matthew Reed indicate that, since the middle of last year, the US has bombed wells extensively for the first time, which were previously avoided in fear of environmental damage. It has stepped up the tempo of strikes on trucks and backyard oil refineries. ISIL’s production may now be below 10,000 bpd.
Earlier this month, the Syrian army said it had captured small oilfields in Raqqa province and, advancing on the town of Sukhna, was on the way to approach Deir Al Zor, the heart of Syria’s oil industry. But the fighting and the crude extraction methods will leave a damaging environmental legacy, as well as a wrecked local economy for whatever replaces ISIL’s authority.
Perhaps revealingly, pro-Assad western outlets, shrill on the pipeline conspiracy theories, have said little on New York Times reports that Russian companies have been offered shares in any natural resources they can secure from ISIL. Stroytransgaz, which built gas pipelines in pre-war Syria, was given a phosphate deposit, while Evro Polis was reportedly promised a quarter of oil and gas on territory it captures from ISIL. Both are linked to Russian individuals sanctioned by the United States.
The Kurdish region contains large heavy oilfields, notably Rumailan and Suwaidiyah, which crosses the border into Iraq. After producing solely for local use, the Kurdish Democratic Union Party (PYD), now exports oil both through Turkey and the Kurdish region of Iraq, as well as to Assad-controlled areas. The PYD's armed forces have been the spearhead of the anti-ISIL campaign, but it remains to be seen whether the US will continue to back them, and how the Kurdish cantons will achieve economic independence.
Prospects for an autonomous Kurdish region, Rojava, to emulate its Iraqi cousin and develop and export oil on a large scale, are doubtful. Insecurity and legal uncertainty make it near-impossible for international companies to return. Possible pipeline routes are blocked by Turkey to the north, their Iraqi Kurdish rivals to the east and Assad to the south. But at some point the Kurds could strike a deal with the Assad regime to reopen the pipeline that runs south of Raqqa, to Homs and the Mediterranean.
A recent World Bank report lays out the toll the war has taken on all sectors of the Syrian economy. Petroleum, which made up about 27 per cent of the pre-war economy, has shrunk to negligible levels, while the total GDP has fallen 63 per cent.
The pariah Assad regime cannot expect much in terms of international aid – its main allies, Russia and Iran, have already spent lavishly on supporting his war effort, and have their own bills to pay. EU sanctions on Syrian oil exports remain, while efforts to block illicit trucking of crude by ISIL through Turkey and Iraq have escalated.
Terrorist-linked and sanctioned groups will remain deeply embedded in what remains of petroleum operations and trade. Control of fuel and electricity, like food, is a key tool of regime control.
Yet repairing the oil and gas sector will be critical to restoring electricity, providing local fuel, funding reconstruction and providing government revenues – whether to Damascus or local autonomous administrations. As the guns fall silent in some areas, even while slaughter continues in others, the tangled web of Syrian oil will continue to ensnare.
Robin Mills is chief executive of Qamar Energy, and author of The Myth of the Oil Crisis
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How Filipinos in the UAE invest
A recent survey of 10,000 Filipino expatriates in the UAE found that 82 per cent have plans to invest, primarily in property. This is significantly higher than the 2014 poll showing only two out of 10 Filipinos planned to invest.
Fifty-five percent said they plan to invest in property, according to the poll conducted by the New Perspective Media Group, organiser of the Philippine Property and Investment Exhibition. Acquiring a franchised business or starting up a small business was preferred by 25 per cent and 15 per cent said they will invest in mutual funds. The rest said they are keen to invest in insurance (3 per cent) and gold (2 per cent).
Of the 5,500 respondents who preferred property as their primary investment, 54 per cent said they plan to make the purchase within the next year. Manila was the top location, preferred by 53 per cent.
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
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The smuggler
Eldarir had arrived at JFK in January 2020 with three suitcases, containing goods he valued at $300, when he was directed to a search area.
Officers found 41 gold artefacts among the bags, including amulets from a funerary set which prepared the deceased for the afterlife.
Also found was a cartouche of a Ptolemaic king on a relief that was originally part of a royal building or temple.
The largest single group of items found in Eldarir’s cases were 400 shabtis, or figurines.
Khouli conviction
Khouli smuggled items into the US by making false declarations to customs about the country of origin and value of the items.
According to Immigration and Customs Enforcement, he provided “false provenances which stated that [two] Egyptian antiquities were part of a collection assembled by Khouli's father in Israel in the 1960s” when in fact “Khouli acquired the Egyptian antiquities from other dealers”.
He was sentenced to one year of probation, six months of home confinement and 200 hours of community service in 2012 after admitting buying and smuggling Egyptian antiquities, including coffins, funerary boats and limestone figures.
For sale
A number of other items said to come from the collection of Ezeldeen Taha Eldarir are currently or recently for sale.
Their provenance is described in near identical terms as the British Museum shabti: bought from Salahaddin Sirmali, "authenticated and appraised" by Hossen Rashed, then imported to the US in 1948.
- An Egyptian Mummy mask dating from 700BC-30BC, is on offer for £11,807 ($15,275) online by a seller in Mexico
- A coffin lid dating back to 664BC-332BC was offered for sale by a Colorado-based art dealer, with a starting price of $65,000
- A shabti that was on sale through a Chicago-based coin dealer, dating from 1567BC-1085BC, is up for $1,950
Book%20Details
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The%20specs
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Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
Titanium Escrow profile
Started: December 2016
Founder: Ibrahim Kamalmaz
Based: UAE
Sector: Finance / legal
Size: 3 employees, pre-revenue
Stage: Early stage
Investors: Founder's friends and Family
World Cup warm up matches
May 24 Pakistan v Afghanistan, Bristol; Sri Lanka v South Africa, Cardiff
May 25 England v Australia, Southampton; India v New Zealand, The Oval
May 26 South Africa v West Indies, Bristol; Pakistan v Bangladesh, Cardiff
May 27 Australia v Sri Lanka, Southampton; England v Afghanistan, The Oval
May 28 West Indies v New Zealand, Bristol; Bangladesh v India, Cardiff
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
