News / Africa

Growing Sudan, South Sudan Oil Impasse Has High Stakes

Drilling tubing is piled next to the drilling site number 102 in the Unity oil field, South Sudan (2010 file photo).
Drilling tubing is piled next to the drilling site number 102 in the Unity oil field, South Sudan (2010 file photo).
Nico Colombant

African Union mediation to end an oil standoff between Sudan and South Sudan is expected to resume this week. Analysts say the stakes are high for the governments in Khartoum and Juba, both of which rely heavily on oil revenue to maintain themselves.

Jimmy Mulla, from the Washington-based Voices for Sudan advocacy group, is one of many analysts pessimistic about the current oil impasse. “I think as of now it is nearly impossible because the two parties are completely on different platforms," he said.

Disagreements on oil transfer fees and accusations by South Sudan that Sudan was stealing southern oil coming through its pipeline led to Juba’s recent decision to shut down oil production.

Mulla puts most of the blame on Sudan. “For the most part, I would still go back and say the government in Khartoum has not been forthcoming in terms of making sure this agreement goes forward. There are international standards, there are international agreements on oil revenues, whether it is a transit fee, all these things are in place, and these are references that have been tabled both by the government of South Sudan and also by the African Union mediating body, so it should have been easier to resolve but the lack of political will to address this issue has been a major problem," he said.

The exact terms of oil revenue sharing were not agreed to before South Sudan became independent last year, following decades of civil war.

A Washington-based international relations expert Walid Phares accuses Sudan of doing whatever it can to muddle the post-breakup phase. “Keep in mind that the northern regime did not really let go of South Sudan.  They want to try to control it.  They want to try to instigate trouble within the Southern Sudanese regions," he said.

Both countries accuse each other of backing cross-border rebellions, as the exact border and some regions remain in dispute. Sudan’s President Omar al-Bashir recently said his country was closer to war with South Sudan than peace.

After the breakup, Sudan started by asking $32 in transit fees for each barrel of South Sudanese oil shipped through its pipeline and then upped the request to $36. Those two figures are more than ten times standard rates.

Analysts say the government in Khartoum has been very nervous with the loss of oil revenue as it has also been struggling with a lack of foreign currency, high inflation, civil society discontent and $38 billion in external debt.

Eric Reeves, a Sudan researcher at Smith College, believes Sudan’s government also wants to use the oil impasse as leverage to ease its debt. “Now, there have been discussions in the UK, in Germany and France that suggests it might be the case that these countries anyway are contemplating debt relief. I think that is a terrible signal to be sending Khartoum.  It only encourages them to be more intransigent, more ruthless in expropriating revenues from southern oil," he said.

Other analysts interviewed for this report said Asian countries which have been the main consumers of South Sudanese oil, especially the biggest buyer China, should try harder to help find a solution.

They warn South Sudan, which depends nearly entirely on oil revenues for state income, could easily become a failed state with escalating sectarian violence and angry unpaid soldiers if the oil shutdown persists.  

South Sudanese officials have talked about building an alternative pipeline to the Kenyan port of Lamu, but most analysts say this seems unrealistic at this point, because of cost and security issues.

The only hope they say would be for a major deal which addresses other current concerns such as ending the cross-border violence and finding long-term solutions for the remaining regions in dispute.

You May Like

US, China Have Dueling Definitions of Cybersecurity

Analysts say attribution or or proving that a particular individual or government is responsible for a hack, is a daunting task More

Snowden: I'd Go to Prison to Return to US

Former NSA contractor says he has not received a formal plea-deal offer from US officials, who consider him to be a traitor More

Goodbye Pocahontas: Photos Reveal Today's Real Native Americans

Weary of stereotypes, photographer Matika Wilbur is determined to reshape the public's perception of her people More

This forum has been closed.
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Russia’s Syria Involvement Raising Concerns in Europei
Luis Ramirez
October 02, 2015 4:45 PM
European nations are joining the United States in demanding that Russia stop targeting opposition groups other than the Islamic State militants as Russian warplanes continue to conduct raids in Syria. The demand came in a statement from Britain, France, Germany, Qatar, Saudi Arabia, Turkey and the United States Friday. VOA Europe correspondent Luis Ramirez reports.

Video Russia’s Syria Involvement Raising Concerns in Europe

European nations are joining the United States in demanding that Russia stop targeting opposition groups other than the Islamic State militants as Russian warplanes continue to conduct raids in Syria. The demand came in a statement from Britain, France, Germany, Qatar, Saudi Arabia, Turkey and the United States Friday. VOA Europe correspondent Luis Ramirez reports.

Video First Self-Driving Truck Debuts on European Highways

The first automated semi-trailer truck started its maiden voyage Friday, Oct. 2, on a European highway. The Daimler truck called 'Actros' is the first potentially mass-produced truck whose driver will be required only to monitor the situation, similar to the role of an airline captain while the plane is in autopilot mode. VOA’s George Putic reports.

Video Nano-tech Filter Cleans Dirty Water

Access to clean water is a problem for hundreds of millions of people around the world. Now, a scientist and chemical engineer in Tanzania (in East Africa) is working to change that by creating an innovative water filter that makes dirty water safe. VOA’s Deborah Block has the story.

Video Demand Rising for Organic Produce in Cambodia

In Cambodia, where rice has long been the main cash crop, farmers are being encouraged to turn to vegetables to satisfy the growing demand for locally produced organic farm products. Daniel de Carteret has more from Phnom Penh.

Video Migrant Influx Costs Europe, But Economy Could Benefit

The influx of hundreds of thousands of refugees and migrants is testing Europe’s ability to respond – especially in the poorer Balkan states. But some analysts argue that Europe will benefit by welcoming the huge numbers of young people – many of them well educated and willing to work. Henry Ridgwell reports from London.

Video Botanists Grow Furniture, with Pruning Shears

For something a bit out of the ordinary to furnish your home, why not consider wooden chairs, crafted by nature, with a little help from some British botanists with an eye for design. VOA’s Jessica Berman reports.

Video New Fabric Helps Fight Dust-Related Allergies

Many people around the world suffer from dust-related allergies, caused mainly by tiny mites that live in bed linen. Polish scientists report they have successfully tested a fabric that is impenetrable to the microscopic creatures. VOA’s George Putic has more.

Video Burkina Faso's Economy Deeply Affected by Political Turmoil

Political turmoil in Burkina Faso over the past year has taken a toll on the economy. The transitional government is reporting nearly $70 million in losses in the ten days that followed a short-lived coup by members of the presidential guard earlier this month. The crisis shut businesses and workers went on strike. With elections on the horizon, Emilie Iob reports on what a return to political stability can do for the country's economic recovery.

Video Fleeing Violence, Some Syrians Find Refuge in Irbil

As Syrians continue to flee their country’s unrest to seek new lives in safer places, VOA Persian Service reporter Shepol Abbassi visited Irbil, where a number Syrians have taken refuge. During the religious holidy of Eid al-Adha, the city largely shut down, as temperatures soared. Amy Katz narrates his report.

Video Nigeria’s Wecyclers Work for Reusable Future in Lagos

The streets and lagoons of Africa's largest city - Lagos, Nigeria - are often clogged with trash, almost none of which gets recycled. One company is trying to change that. Chris Stein reports for VOA from Lagos.

Video Sketch Artist Helps Catch Criminals, Gives a Face to Deceased

Police often face the problem of trying to find a crime suspect based on general descriptions that could fit hundreds of people in the vicinity of the crime. In these cases, an artist can use information from witnesses to sketch a likeness that police can show the public via newspapers and television. But, as VOA’s Greg Flakus reports from Houston, such sketches can also help bring back faces of the dead.

Video Thailand Set to Build China-like Internet Firewall

Thai authorities are planning to tighten control over the Internet, creating a single international access point so they can better monitor content. VOA Correspondent Steve Herman reports from Bangkok on what is being called Thailand’s own "Great Firewall."

Video Croatian Town’s War History Evokes Empathy for Migrants

As thousands of Afghanistan, Iraqi and Syrian migrants pass through Croatia, locals are reminded of their own experiences with war and refugees in the 1990s. VOA's Daniel Schearf reports from the town of Vukovar, where wartime scars still are visible today.

Video Long Drought Affecting California’s Sequoias

California is suffering under a historic four-year drought and scientists say even the state's famed sequoia trees are feeling the pain. The National Park Service has started detailed research to see how it can help the oldest living things on earth survive. VOA’s George Putic reports.

VOA Blogs