Syria sees an energy deficit despite military advances

Significance

The Syrian army and its allies have driven IS out of most of the region from Homs to the edge of the Euphrates valley, recapturing several gas fields. This has yielded a marginal improvement to the energy balance, but the government is still heavily dependent on Iranian oil supplies.

Impacts

• Increasing energy production will buttress Damascus’s claim to be regaining control over the whole of Syria.
• Actual output hikes will be limited, and offset by increased energy demand if security improves and refugees return.
• Future oil production increases will also depend on the political arrangements reached with the Syrian Kurds.
• Russia and Iran may compete over concessions to operate the recently retaken phosphate mines near Palmyra.