Bashir threatens to block southern oil

President Omar al-Bashir told a cheering crowd of supporters in the northern oil-exporting town of Port Sudan that he would block the flow of southern oil if a deal is not reached on sharing revenues ahead of the south’s independence on 9 July.

Sudan has an estimated 5 billion barrels of oil but the south produces roughly three-quarters of the country’s daily output of nearly half a million barrels of crude.

Oil was first pumped in 1999 while the civil war raged and deliberate marginalisation during those war-torn years mean that all the pipelines built head north towards the only refineries and port.

There is no oil infrastructure in the south, and a mooted pipeline southwards to the Kenyan coast would take years to build.

Under the peace agreement that ended the fighting in 2005 Khartoum has received all the revenues from northern oil fields plus about half of the revenues from southern oil fields, but on 9 July that agreement expires.

Negotiations are still underway but with both sides heavily dependent on oil revenues – oil accounts for 98% of the south’s budget and more than half of the north’s – Bashir is displaying typical bravado and brinkmanship.

Bashir’s grip on power will be weakened by the loss of southern oil (which alone accounts for 36.5% of the north’s budget) so his threat to cut-off the south’s oil is designed to intimidate the south into giving him what he wants.

"I give the south three alternatives for the oil," Bashir said.

"The north is to continue getting its share, or the north gets fees for every barrel that the south sends to Port Sudan. If they don't accept either of these, we're going to block the pipeline,” he said.

The situation is desperate for Bashir who relies on oil money to snub US-led sanctions, to grease the wheels of the patronage network that keeps him in power and to fund his armed forces.