Global Energy Advisory – 12th June 2015

Sudan & South Sudan: A Lifelong Dictator for Khartoum, and More Oil Uncertainty in the South

South Sudan’s military said its forces are in control of the oil fields in Unity and Upper Nile States, while rebel forces claim the contrary, saying they have captured the fields. What this really means is that the battle is still raging, and no one is in complete control. The likelihood is that the rebels have made gains here, but the government cannot concede this because this would be the end game. The rebels, likewise, have a need to exaggerate their successes. South Sudan’s only revenues come from oil. Whoever controls the oil controls the newly independent country, but at present no one is producing fields in Unity state due to the raging conflict. We also give credence to rumors that Khartoum (the capital of Sudan, which lost all its oil when South Sudan gained independence in 2011) is funding and arming rebels in South Sudan. At the same time, in Sudan, President Omar al-Bashir—a war criminal at the best of times—won elections again last month and is now forming a new government. This, despite the fact that the elections were boycotted by the main opposition parties and voter turnout was very low. Bashir is now 71 and he seized power in an Islamist-backed coup in 1989. His time for reforming the crumbling country, however, is running out. Cracks are showing in his power base, and without the South’s oil, he has nothing.

‘Oil…