Rebel takeover in Damascus shakes up Syrian power dynamics

On Sunday, rebels from HTS, the Islamist group Hayat Tahrir al-Sham led by Abu Muhammad al-Jolani, and the Syrian National Army seized the capital of Syria, Damascus. President Bashar al-Assad fled and, along with his family, secured asylum in Russia, which had supported his authoritarian regime for years. Thus, after 24 years, Assad's regime has fallen.

The armed conflict in Syria, which has been ongoing since 2011, has not concluded. The overthrow of Assad has created a power vacuum, with various groups competing for control and influence in the country. The fight against the regime united different factions' interests, but now the battle for control—particularly over strategic resources—is starting anew.

Syria is divided. Different forces operate in various parts. One thing is certain: Assad is out of the Syrian equation, comments Jacek Tarociński, a Polish analyst in the security and defense team at the Centre for Eastern Studies for money.pl.

Syria was one of the important oil producers in the Mediterranean region. Before the conflict, the country had substantial resources, especially in the northeastern regions, such as Deir ez-Zor. Natural gas fields in the Homs and Palmyra regions were also significant.

As recently as 2010, Syria's oil trade constituted about 25% of the country's budget and 20% of export value. The country exported most of its production primarily to Europe and Turkey.

However, sanctions on Bashar al-Assad's regime and, most importantly, the internal conflict led to a collapse of the oil sector. In 2008, Syria produced about 406,000 barrels daily (a single barrel contains 42 US gallons, equivalent to 159 litres). By 2018, production had dropped to just 24,000 barrels. In 2023, it was 135,000 barrels, and the latest data from July 2024 indicates about 95,000 barrels, according to Trading Economics data.

Oil fields became valuable prizes for various armed groups, including the so-called Islamic State (Daesh). Some of the oil extraction was used internally, while some was sold on the black market to finance organizations. At the peak of their activity, Islamists controlled most of the oil fields in eastern Syria, producing between 34,000 and 40,000 barrels daily.

For this reason, both oil fields and infrastructure became targets for British and American airstrikes.

For example, the main refineries in Homs and Banias were attacked multiple times. In January 2020, a strike on underwater pipelines at the Banias refinery caused significant infrastructure damage. The remaining network of oil and gas pipelines also suffered considerable damage, due to direct military actions or acts of sabotage.

Currently, Syria is not a significant player in the oil market, as production has fallen more than 12-fold since the start of the civil war, points out Tymon Pastucha, an analyst at the Polish Institute of International Affairs (PIIA), in dialogue with money.pl.

However, Syria still has significant extraction potential and could aspire to be a transit country, e.g., for gas and oil from the Gulf states, notes the expert.

Some of this potential is being utilized by the Kurds (SDF - Syrian Democratic Forces), who control a significant portion of northeastern Syria. Key oil fields, such as al-Omar, are under their control. Production from these fields is primarily used for local needs and to finance Kurdish forces' activities.

However, this is also under threat from Turkish forces. Ankara considers the Kurds to be terrorists, and their status is a contentious issue within NATO. American troops have supported the rebels and also have bases in Syria, mainly near the Iraqi border. President Biden has announced continued engagement in Syria.

It seems that the Americans have given the Turks a free hand to act against the Kurds west of the Euphrates while specifying they cannot operate east of the river, Tarociński points out.

However, Syria still has significant extraction potential. It may also aspire to be a transit country. Turkey, in particular, is interested in this because it wants to become a regional energy hub, so it is likely to be involved in infrastructure development and regional stabilization. Similar observations can be made regarding the Gulf states, such as Iraq and Qatar, says Tymon Pastucha.

As the PIIA expert notes, the development of gas infrastructure is not guaranteed due to the growth of LNG, which may become more attractive than long-term, capital-intensive pipeline investments. Furthermore, the situation in Syria must be sufficiently stable to consider such investments, Pastucha observes.

Capital is also necessary. American involvement is hard to predict. On one hand, Donald Trump argued that the US should not further engage in the Syria conflict. On the other, when he boasted in the fall of 2019 about the elimination of the Islamic State leader Abu Bakr al-Baghdadi, he indicated he wanted American oil companies to manage the remaining Syrian oil and gas fields.

China and India are also significant players, remaining neutral in this conflict. The Chinese giant CNPC and Indian corporation ONGC held shares in the Syrian Al-Furat Petroleum Company, one of the largest oil producers in Syria before the conflict. Their activities are now very limited.

The shock from Bashar al-Assad's fall is also a blow to regime-supporting Russia and Iran, weakening their positions. The Russians are withdrawing forces and personnel from military bases. They are also leaving the strategically important port of Tartus, a naval base on the Mediterranean Sea, and withdrawing aircraft from bases deep within Syria.

Whether the Russians will fully withdraw from Syria remains uncertain. Russia supported Assad's regime, but it's possible they may reach an agreement with one of the rebel factions. Remember, this is not a unified group, and they were united only by the goal of ousting Assad, the expert notes.

Russia leveraged its contacts with Assad to further its interests. Among the main extraction companies in the oil sector were Russian enterprises. In March 2021, the Russian company Capital Limited signed a contract with the Syrian Ministry of Oil and Mineral Resources for exclusive rights to search for oil and gas along the eastern Mediterranean coast, up to the Syrian-Lebanese border.

But Russian activity in the region began earlier. At the end of 2013, the Russian firm Soyuzneftegaz signed an agreement with the Syrian government to search for and exploit oil and gas. The war prevented the fulfillment of these agreements, and they ceased operations in Syria in 2015. However, four years later, two more Russian companies, Mercury LLC and Velada LLC, undertook resource exploration and extraction in Syria.

Certainly, the current events will limit the influence of Russian extraction companies in Syria, which were interested in investing and obtaining lucrative extraction rights from the Assad regime, summarizes Tymon Pastucha, an analyst at PIIA.