Syria-US Gas Deal Aims to Ease Financial Bottleneck

Syria’s Jihar gas field, one of the country’s major gas fields, in the desert west of Palmyra in Homs province. Syrian Energy Ministry/File Photo
Syria’s Jihar gas field, one of the country’s major gas fields, in the desert west of Palmyra in Homs province. Syrian Energy Ministry/File Photo
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Syria-US Gas Deal Aims to Ease Financial Bottleneck

Syria’s Jihar gas field, one of the country’s major gas fields, in the desert west of Palmyra in Homs province. Syrian Energy Ministry/File Photo
Syria’s Jihar gas field, one of the country’s major gas fields, in the desert west of Palmyra in Homs province. Syrian Energy Ministry/File Photo

The Syrian Petroleum Company has signed a major implementation contract with US companies ConocoPhillips and Novaterra Energy to develop gas fields and raise production, marking the most significant strategic breakthrough in economic and political ties between Damascus and Washington since the fall of Bashar al-Assad’s government in late 2024.

The agreement is the first major US energy deal in Syria in years. It also offers the clearest sign yet that the country has entered a phase of “integrated implementation” after US President Donald Trump’s decision to lift sanctions in July 2025.

The contract follows earlier US moves, beginning in early 2026, through memoranda of understanding with other companies, including Chevron for offshore exploration and HKN Energy for the onshore Rmeilan fields.

But the ConocoPhillips deal stands out as the largest binding implementation contract to develop Syria’s domestic gas sector, backed by Gulf and European alliances and financing aimed at ending the country’s acute energy crisis.

Energy experts say the deal, based on understandings reached last November, will go beyond the technical oil and gas sector. They see it as an international “vote of confidence” that could help break the financial bottleneck facing Syria’s new government, whose 2026 budget deficit is estimated at about $1.8 billion.

The US return comes as major regional and international players move into Syria’s energy sector through parallel contracts and partnerships with Saudi companies, including ADES, as well as Qatari and French firms. Together, these moves place Syria’s gas sector on the edge of a promising new phase that could drive recovery and reconstruction.

The contract puts earlier understandings into effect. In November 2025, the Syrian Petroleum Company signed a memorandum of understanding with ConocoPhillips and Novaterra Energy. Technical, legal and commercial talks followed, culminating in the latest agreement.

Importance of the contract

Syrian academic and energy expert Ziad Arbash said the deal matters because it turns a memorandum of understanding into an implementation contract. It sends a strong signal to global markets, he said, that Syria has become an attractive destination for oil and gas investment.

He said the agreement would also raise the “level of oil activity” in Syria in tangible ways: more work teams, engineers and technicians in the fields, modern rigs and equipment built to the latest technical standards, and stronger infrastructure and logistics to support company operations.

Arbash told Asharq Al-Awsat that every additional company operating in Syria helps draw in others. That, he said, lowers operating costs through economies of scale and the exchange of expertise, while creating a competitive environment that benefits the national economy.

A vote of confidence

The contract could have a wider ripple effect. For Arbash, the presence of a company the size of ConocoPhillips in the Syrian market is “a vote of confidence for other companies.”

He said it reduces the perceived risks of investing in Syria and demonstrates the Syrian government’s commitment to creating an investment environment that can attract major international firms.

Recent indicators point in the same direction. The Syrian Petroleum Company signed a contract with Saudi Arabia’s ADES to develop gas fields in April, after signing a memorandum of understanding with US company Chevron and a Qatari company in February. Reports have also pointed to alliances between US and Saudi companies to invest in northeastern Syria.

Breaking the financial bottleneck

The new Syrian government inherited a shattered economy from the previous government and is struggling with a budget deficit of about $1.8 billion.

According to figures presented by Finance Minister Yisr Barnieh at an April news conference announcing the 2026 budget, revenues are estimated at about 959 billion Syrian pounds, or around $8.7 billion, against spending of 1,056.7 billion pounds, or about $10.5 billion.

Arbash described the contract as “a pivotal step in overcoming the financial bottleneck” in the state budget through two linked tracks.

The first is easing the import bill. Syria currently depends on imports and regional supplies to improve electricity provision. At its pre-war peak, gas output stood at about 28 million cubic meters per day. It has since fallen to roughly a third of that level.

The government aims to raise production to about 15 million cubic meters per day next year. The contract is expected to add between 4 million and 5 million cubic meters per day within one year of work beginning. According to Arbash, that would sharply reduce the cost of importing oil and petroleum products, while better securing local gas needs for electricity and other vital sectors.

The second track is “exports and revenues.” Once Syria achieves a production surplus, it could move toward exports, generating hard currency that would ease pressure on the state budget and strengthen its ability to finance reconstruction and development projects.

Current estimates suggest the first phase of the project could increase production within one year of work beginning. Arbash urged caution, however, saying: “Let us be realistic and add another year before reaching the increase of 5 million cubic meters per day.”

An important breakthrough in bilateral relations

The contract was signed as relations between Syria’s new authorities and the Trump administration continue to improve after the fall of Bashar al-Assad’s rule in late 2024.

Arbash said the agreement represents an important breakthrough in relations between the two countries. It is the first implementation contract with a major US oil and gas company since Assad’s fall, reflects a shift in US policy toward Syria, and opens a channel for direct economic cooperation that could positively impact other political files.

The signing came as Damascus continues efforts to attract US investment. Syrian Energy Minister Mohamed al-Bashir discussed investment opportunities in the oil and gas sector with US officials last week.

According to Arbash, the deal could pave the way for broader normalization between the two countries, especially as other US companies enter the scene, including Baker Hughes, Hunt Energy and Argent LNG, which are preparing a comprehensive plan to develop Syria’s energy sector.

Current state of gas fields and production

Syria’s gas sector faces a long road back from the deep supply deficit left by 14 years of conflict. A United Nations report estimates direct and indirect losses to the oil and gas sector at more than $115 billion between 2011 and 2023.

Current production data published on the US Embassy in Damascus page shows a total domestic gas supply of only 7-10 million cubic meters per day. That is a steep fall from the pre-war peak of up to 30 million cubic meters per day.

Demand, meanwhile, has risen to between 23 million and 30 million cubic meters per day, driven mainly by the severe shortage in electricity generation. The gap leaves a daily shortfall of up to 15 million cubic meters, placing heavy constraints on power plants.

That is why Damascus has set its sights on a strategic goal for 2030: using the new international partnerships to double gas production before the end of the decade.

Infrastructure

The sector suffered heavy damage during the war, including to fields, facilities and transmission lines. Sanctions also obstructed maintenance for years. Still, Arbash said that developing proven gas reserves estimated at about 285 billion cubic meters could allow current production to return to its pre-war peak of 28 million cubic meters per day within four years.

Syria needs about 23 million cubic meters of water per day to ensure continuous electricity supplies.

For now, the country relies on imports and regional supplies to improve electricity provision. These include a project to supply Azerbaijani gas through Türkiye with Qatari financing, providing about 3.4 million cubic meters per day, or to supply it directly from Qatar through Jordan.

Syria is currently focused on rehabilitating infrastructure at existing fields through contracts with companies such as Saudi Arabia’s ADES. It also aims to double production through strategic partnerships with international companies, as reflected in the contract with ConocoPhillips and Novaterra Energy.

For Arbash, the signing marks “a qualitative shift in Syria’s energy sector” at a critical moment. Syria, he said, is trying to overcome its financial bottleneck, raise the “level of oil activity,” restore international confidence, attract additional Arab and Western investment, and “open a new page in Syrian-US relations through direct economic cooperation.”

“With expectations that the fruits of this contract will begin to appear within a year, and with parallel projects involving Saudi, Qatari and French companies, Syria’s gas sector is entering a promising phase that could become a main driver of economic recovery and a way out of the suffocating financial crisis, provided there is transparency in tendering and implementation,” Arbash said.

Where are the fields?

The agreements quickly had an impact on the ground. The Syrian Petroleum Company recently took over oil and gas fields that had been controlled by the Kurdish-led autonomous administration in the northeast, extending government control over resources concentrated in three main areas.

The eastern region, including Deir Ezzor and Hasakah, includes the Conoco field northeast of Deir Ezzor. ConocoPhillips established the field in 2001 with a capacity of 4.7 billion cubic meters a year. It produced 13 million cubic meters per day before halting operations because of attacks. The region also includes the al-Jabsa field in Hasakah. Together, the two fields accounted for 53% of Syria’s production before 2011.

The central region and the Homs desert include al-Shaer, the country’s largest field, with a production capacity of 35 million cubic meters per year in 2010. The area also includes the al-Jihar field west of Palmyra, as well as the al-Mahr and al-Jazal fields.

Arbash concluded that, based on these combined indicators, Syria’s gas sector is entering a promising phase capable of leading economic recovery and easing the suffocating financial crisis, provided the highest standards of “transparency in tendering and implementation” are upheld.

 



S&P Global Ratings Affirms Saudi Arabia Credit Rating at A+ with Stable Outlook

An aerial view of the Financial District in Riyadh (SPA)
An aerial view of the Financial District in Riyadh (SPA)
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S&P Global Ratings Affirms Saudi Arabia Credit Rating at A+ with Stable Outlook

An aerial view of the Financial District in Riyadh (SPA)
An aerial view of the Financial District in Riyadh (SPA)

Credit rating agency S&P Global affirmed Saudi Arabia's credit rating at A+ with a stable outlook, according to its latest report.

It stated that the stable outlook reflects its view that Saudi Arabia will be able to withstand pressures stemming from the ongoing Middle East conflict.

This takes into account the Kingdom's diversified energy export infrastructure, including its ability to redirect crude oil exports to the Red Sea through the East-West oil pipeline, as well as its substantial oil storage and refining capacity both domestically and abroad.

The agency also noted that the stable outlook reflects continued non-oil growth momentum and associated non-oil revenue, together with the government's ability to calibrate investment expenditure linked to Saudi Vision 2030, which should continue to support the economy and fiscal trajectory.

Despite the conflict, non-oil activity has remained reasonably resilient, supported by consumer spending.

S&P expects real GDP to contract by 0.9% in 2026 before rebounding sharply by 8.2% in 2027, supported by an increase in oil production, and to average 3.3% in 2028-2029.

The non-oil sector, including government activities, now accounts for about 70% of GDP, up from 65% in 2018, reflecting continued structural progress in economic diversification.

The agency further highlighted Saudi Arabia's substantial net general government asset position as a key strength and noted that foreign-exchange reserves reached their highest level since early 2020.

It stated that the ongoing recalibration of Saudi Vision 2030 project implementation should support fiscal resilience. S&P also expects the Kingdom to continue adopting a prudent and flexible approach in this regard, having stressed its commitment to achieving Saudi Vision 2030 goals without jeopardizing public finances.

The agency noted that ongoing structural reforms will remain important in supporting non-oil growth.


CEER to Reveal First Flagship Vehicles in Saudi Arabia on Sept. 21

A glimpse of the car's design that CEER aims to launch later this September (Asharq Al-Awsat)
A glimpse of the car's design that CEER aims to launch later this September (Asharq Al-Awsat)
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CEER to Reveal First Flagship Vehicles in Saudi Arabia on Sept. 21

A glimpse of the car's design that CEER aims to launch later this September (Asharq Al-Awsat)
A glimpse of the car's design that CEER aims to launch later this September (Asharq Al-Awsat)

CEER, Saudi Arabia's first automotive company and Original Equipment Manufacturer (OEM), has announced the reveal date of the world premiere of its first flagship vehicles, an electric sedan and SUV, on September 21.

Friday’s announcement reflects the Kingdom’s strategic direction toward developing an advanced industrial sector aligned with the objectives of Saudi Vision 2030 and strengthening Saudi Arabia’s position on the global automotive industry map.

“At the beginning of this year, we said that 2026 is the year of CEER. I am happy to announce that we’ve set the date for the reveal of our first flagship vehicles,” said CEO of CEER James DeLuca.

“The world is about to witness a historic moment, the result of an incredible journey from initial design and intensive engineering to the buildup of one of the most advanced manufacturing facilities in the world, in record time.”

CEER was created as a joint venture between the Public Investment Fund and Foxconn. It is the only company in Saudi Arabia to design, engineer, source, validate, manufacture, and soon sell and service a portfolio of aspirational vehicles.

CEER is positioned to be a key enabler of Saudi Arabia's industrial transformation (Asharq Al-Awsat)

Since its inception in 2022, CEER has been focused on building a diverse mix of Saudi talent and global experts that had grown from 20 employees to 2,300; securing key partnerships with renowned international partners including BMW, Hyundai Transys, Rimac, Siemens, Sabelt, Isoclima, ANDRITZ Schuler, Dürr, XYG, Lear, Benteler, Fangxin, Shin Young, JVIS, as well as leading local companies including Zamil Group, Abdul Latiff Jameel Group and APICO (Balubaid Group) that are driving the target of reaching 45% local content by 2034; building one of the most advanced manufacturing complexes in the world; and designing, engineering and testing vehicles that are tailor-made to the specific requirements of Saudi Arabia and the region.

CEER is positioned to be a key enabler of Saudi Arabia's industrial transformation, creating lasting economic impact and supporting the Kingdom's diversification ambitions under Vision 2030.

CEER is projected to contribute $8 billion (around SAR30 billion) to Saudi Arabia’s GDP, $21 billion (around SAR80 billion) to trade balance improvement, and create approximately 30,000 direct and indirect jobs, with 80% of direct jobs held by Saudis. CEER supports the Saudi Green Initiative target of Net-Zero emissions in Saudi Arabia by 2060.


Oil Falls but on Track for 8% Weekly Gain on Supply Concerns; US Diesel Hits Record High

WHITING, INDIANA - SEPTEMBER 08: An aerial view shows the sprawling BP refinery on September 08, 2026 in Whiting, Indiana. (Photo by SCOTT OLSON / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
WHITING, INDIANA - SEPTEMBER 08: An aerial view shows the sprawling BP refinery on September 08, 2026 in Whiting, Indiana. (Photo by SCOTT OLSON / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
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Oil Falls but on Track for 8% Weekly Gain on Supply Concerns; US Diesel Hits Record High

WHITING, INDIANA - SEPTEMBER 08: An aerial view shows the sprawling BP refinery on September 08, 2026 in Whiting, Indiana. (Photo by SCOTT OLSON / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
WHITING, INDIANA - SEPTEMBER 08: An aerial view shows the sprawling BP refinery on September 08, 2026 in Whiting, Indiana. (Photo by SCOTT OLSON / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)

Oil prices fell on Friday but remained on course for a weekly gain of more than 8% while US diesel prices hit a record high as attacks along Middle East shipping routes stoked concerns about prolonged supply disruptions.

Brent crude futures were down $3.45, or 3.21%, to $104.18 a barrel at 1132 GMT.

US West Texas Intermediate crude fell $2.96, or 2.89%, to $99.52 a barrel. Both benchmarks hit their highest levels since mid-May earlier in the session.

The benchmarks reversed early gains after the Financial Times reported that foreign ministers in the Middle East are trying to work out a temporary deal with Iran to manage shipping through the Strait of Hormuz.

Brent and WTI rose more than 6% on Thursday after an escalation in shipping attacks in the region.

"Some headlines of possible new talks in the Middle East are weighing moderately on oil prices today," said UBS energy analyst Giovanni Staunovo. "I keep seeing near-term risks to the upside for oil prices, but we should expect ongoing high price volatility too."

In a further potentially significant development for Riyadh, satellite imagery showed smoke on Thursday in the vicinity of Saudi Arabia's East-West Pipeline, which has become a vital means for the kingdom to divert its crude exports away from Hormuz.

Saudi Arabia's crude supply fell by 2.3 million barrels per day on the month to 6 million bpd in August, the lowest level in more than three decades, the International Energy Agency said on Friday, citing attacks on Saudi energy facilities.

Adding to concerns over regional oil flows, Yemen's Iran-aligned Houthis on Friday reached the island of Perim in the Bab el-Mandeb Strait, four Yemeni government sources told Reuters, potentially tightening their grip on one of the world's vital shipping routes.

Iran said it had attacked 10 ships near the Strait of Hormuz on Wednesday, after the US hit five Iranian oil tankers. Iran's Islamic Revolutionary Guard Corps said it would escalate its response to any further attacks.

Vessel transits at the Strait of Hormuz fell to seven on Thursday from 11 the previous day, preliminary ship-tracking data showed on Friday.

The strait handled about 125 commodity vessels and one-fifth of global daily oil and liquefied natural gas supplies before the Iran war began in late February.

Meanwhile, two European Central Bank policymakers opened the door on Friday to further interest rate increases if a war-fuelled rise in energy prices continues and pushes up other prices in the euro zone.

SUPPLY DISRUPTIONS LIFT FUEL PRICES

Oil supply disruptions due to the Iran war, along with Ukrainian attacks on Russia's refineries, pushed the US national average diesel price past $6 a gallon for the first time on Thursday, according to price tracker GasBuddy.

"Refined products, particularly diesel, are feeling a one-two punch right now," said Tim Waterer, chief market analyst at KCM Trade.

"As long as both the Gulf shipping constraints and Russian refining outages remain in play, diesel and other refined products are likely to show a higher upside tendency than the broader crude market," he added.

Commerzbank raised its year-end Brent crude forecast to $85 a barrel from $75, while increasing its diesel forecast to $1,200 a ton from $950 and its jet fuel forecast to $1,230 a ton from $980.