South Sudan’s oil exports are severely disrupted by military tensions in Sudan, primarily due to the Rapid Support Forces’ control over essential oil infrastructure. This control has resulted in financial losses of approximately $100 million monthly for South Sudan and poses significant challenges for Sudan as well. The ongoing rivalry between the RSF and Sudanese President Abdel Fattah al-Burhan complicates negotiations for resuming oil exports, which are vital for both nations’ economies. Alternatives for securing oil exports are being considered, yet lasting stability remains dependent on resolving internal political conflicts.
South Sudan, heavily reliant on oil exports, is experiencing a significant disruption in its petroleum activities due to ongoing military tensions in adjacent Sudan. The Rapid Support Forces (RSF), a paramilitary group commanded by Mohamed Hamdane Daglo, commonly referred to as Hemedti, have assumed control over critical infrastructure vital for the exportation of South Sudanese crude oil. This situation has effectively stalled oil exports, which have been suspended for over a year, severely impacting the South Sudanese economy. Approximately 90% of the nation’s government revenues are derived from the oil sector, leading to an estimated loss of $100 million each month resulting from the halted exports. In addition, the cessation of oil flow has imposing implications for Sudan, which earns transit fees from South Sudan’s oil passing through its territory. However, the RSF’s strategic hold over these oil infrastructures also serves as leverage in the ongoing rivalry against Sudanese President Abdel Fattah al-Burhan, further complicating the political landscape and obstructing effective negotiation efforts to restore oil exports. The RSF’s dominance of the pumping stations represents a formidable barrier to the recovery of oil exports for South Sudan. By asserting control over these resources, Hemedti and his forces effectively influence internal political dialogues within Sudan, with their ongoing conflict with al-Burhan manifesting in multiple arenas, thus hindering any swift resolution. The economic ramifications for South Sudan remain severe, as the African Development Bank (AfDB) warns that without a rebound in oil exports, the nation’s current account deficit could stabilize at 7% of GDP for the following fiscal year, severely limiting investment capabilities in essential infrastructure and public services. A projected recovery in oil exports could potentially reduce this deficit to 4% by the 2024-2025 period, contingent on significant progress in Sudan’s internal negotiations. Moreover, the continued suspension of oil exports influences international market stability, as South Sudanese oil constitutes a crucial component of regional output. Consequently, this situation exacerbates existing internal tensions and constrains South Sudan’s ability to navigate the international economic landscape effectively. In light of these challenges, Sudanese authorities are exploring alternative logistical routes to secure their oil exports. A proposed pipeline linking Sudan to Djibouti via Ethiopia is currently under consideration, though its implementation may require several years, offering no immediate relief to the ongoing crisis. The completion of such a pipeline could diversify export pathways, alleviating dependency on shared infrastructure with South Sudan, yet, transit revenue from South Sudan’s oil remains critical for Khartoum amidst its ongoing economic difficulties. The conflict between Hemedti and al-Burhan directly influences the economic relations between Sudan and South Sudan. Without resolution of their political discord, the prospects for a revival in oil exports appear tenuous. This persistent instability hinders Juba’s economic prospects and emphasizes its reliance on the political stability of Sudan. Internal strife is likewise obstructing potential international investments in South Sudan’s oil sector, as investors await clearer and more stable conditions before recommitting. Without a cohesive understanding between the various factions within Sudan, the economic outlook for both South Sudan and Sudan is likely to remain constrained in the immediate future.
The economic landscape of South Sudan is predominantly shaped by its oil sector, accounting for 90% of national revenues. The current military tensions in Sudan, specifically the struggle for control between the Rapid Support Forces and the Sudanese government, have significantly jeopardized the oil export activities of South Sudan, compounding the nation’s economic difficulties. The ongoing conflict has disrupted oil flows, which has economic repercussions not just for South Sudan but also for Sudan, which benefits from transit rights for the exported oil. The RSF’s control over vital oil infrastructures poses serious hurdles for the resumption of oil exports, further entrenching economic instability in both nations. Understanding these dynamics is crucial for addressing the challenges faced by South Sudan amid the geopolitical tensions in the region.
In conclusion, the paralyzing military tensions in Sudan have created a detrimental impact on South Sudan’s oil exports, compromising the economic stability of both nations. With oil exports suspended for over a year due to the RSF’s control of essential infrastructure, South Sudan is experiencing significant financial losses. Efforts to diversify export routes through alternative pipelines offer a potential long-term solution, yet resolution of internal conflicts within Sudan remains critical for the resumption of oil flows. The intertwined economic fates of Sudan and South Sudan underscore the urgent need for political stability and cooperation to foster economic recovery and growth in the region.
Original Source: energynews.pro
