The military tensions in Sudan are critically undermining South Sudan’s oil exports, with the RSF controlling essential infrastructure and blocking oil flows for over a year. South Sudan, dependent on oil for 90% of its revenue, is losing around $100 million monthly due to halted exports, affecting both its economy and Sudan’s transit revenue. Internal rivalries complicate recovery, while Sudan considers alternative export routes.
The military conflict in Sudan is severely crippling oil exports from South Sudan, a nation heavily reliant on its oil sector which constitutes 90% of its revenue. The Rapid Support Forces (RSF), a paramilitary group led by Mohamed Hamdane Daglo, also known as Hemedti, have seized control of vital infrastructure needed to transport South Sudanese crude oil. As a consequence, oil exports have been halted for over a year, resulting in significant economic losses for South Sudan, estimated at approximately $100 million monthly. The situation also adversely affects Sudan, which gains from the transit rights associated with South Sudanese oil that passes through its territory. Hemedti’s strategic position enables him to influence Sudan’s internal political dynamics, impeding negotiations aimed at resuming oil exports. The RSF’s hold over key pumping stations has emerged as a major barrier to the restoration of oil flow, ultimately exacerbating the economic plight of South Sudan. The African Development Bank (AfDB) has warned that the current account deficit for South Sudan will persist at 7% of GDP in 2023-2024 without a revival in oil exports. The prolonged disruption in oil supply disrupts not only the economic stability of South Sudan but also has implications for the regional oil market due to South Sudanese oil being a significant contributor. As a result, internal pressures within South Sudan are being heightened, limiting Juba’s ability to maneuver internationally. In light of this crisis, Sudanese authorities are exploring alternatives for securing their own oil exports, including a proposed pipeline project that links Sudan to Djibouti through Ethiopia. While Djibouti has shown interest in this initiative, the realization of the project could take several years, thus postponing any immediate benefits. Internal rivalries between Hemedti and Sudanese President Abdel Fattah al-Burhan further complicate the political landscape; the outcome of these tensions will ultimately determine the future of oil exports and the economic well-being of both nations. The sustainability of South Sudan’s revenues remains inextricably linked to the stability of Sudan, and until a political resolution is achieved, the economic outlook for both countries appears grim.
South Sudan’s economy is intricately linked to its oil exports, accounting for the overwhelming majority of its financial resources. The ongoing military conflict in neighboring Sudan has led to the monopolization of oil export infrastructure by the RSF, resulting in the halting of exports for over a year. The economic repercussions of this situation are profound, affecting not just South Sudan but also Sudan, which relies on transit fees from these exports. Hence, the political rivalry between the RSF and the Sudanese government complicates the resolution of this crisis, making recovery of oil exports a pivotal issue for economic stability in both nations.
In conclusion, the military tensions within Sudan pose a significant threat to the economic stability of South Sudan, which is heavily reliant on oil exports. The RSF’s control over crucial infrastructure has halted these exports and resulted in substantial financial losses for South Sudan. Efforts to maintain economic stability are impeded by internal political rivalries, which need to be addressed for any hope of recovering oil flows. Meanwhile, Sudan’s exploration of alternative export routes may provide long-term relief but does not address the immediate crisis.
Original Source: energynews.pro
